First Capital Group, which is listed as FMB Capital Holdings plc, has become the most valued company on Malawi Stock Exchange (MSE) with a market capitalisation of K3.4 trillion.
The Mauritius incorporated group, which was founded in the country as First Merchant Bank and now operates under the banner First Capital Bank, has also seen its share price surging 34.5 percent in a week from K1 047 to K1 409 per share by Friday.
In a statement, the group attributed the market cap surge to collective performance of various subsidiaries across the region which reduced the market volatility risks that are associated with one market.
Reads the statement in part: “First Capital Bank Group’s regional business has allowed the group to offset economic weaknesses in certain countries with strength in others, effectively spreading country-specific risks.
“Investors who appreciate consistent profitability have responded positively to this strategy. As a result, the group’s combined operations have yielded a return on equity of 36 percent as of June 2024 and dividend growth remains robust, with dollar dividend in 2024 up by 17 percent compared to 2023.”
Group managing director Jaco Viljoen said for instance, the group’s profitability, which was mainly dependent on its Malawi subsidiary, is now spread equally by almost four businesses, including Botswana, Mozambique and Zimbabwe.
He said: “Today four countries contribute roughly a quarter each, with Zambia, the smallest contributor making up just under 10 percent.
“This shift demonstrates how we have spread the risk across the group’s footprint.”
Meanwhile, investment analyst and chief executive officer for Cider Capital Limited Armstrong Kamphoni has praised the company’s milestone in market cap and share value to its attractiveness to investors.
“What the FCB group has achieved with its regional expansions is the ability to reduce reliance on the volatility of the Malawi economy, which is heavily dependent on agriculture and weather patterns,” he said.
FMB Capital Holdings has subsidiaries in Malawi, Mozambique, Zambia, Zimbabwe and Botswana while the group is based in Mauritius.
