Malawi Stock Exchange (MSE) raised K46.3 billion in 2019, which is 4.7 percent down from K46.8 billion the year before, despite an increase in traded volumes, the market’s annual performance report shows.
Market analysts have attributed the drop in the market’s traded value to low and unattractive share prices in the year.
The 14-counter MSE, according to the report, transacted a total of 1.39 billion shares, a 45.4 percent increase from 958 million shares in 2018.
“Daily average share trades exhibited similar trends where the market registered an average daily volume of 5.6 million shares compared to 3.8 million shares traded in the corresponding period of 2018,” reads the report in part.
It says the average daily turnover for 2019 was K186.9 million compared to K196.3 million during the same period the previous year.
In the year under review, the Malawi All Share Index (Masi), the overall measure of market performance, declined to 4.38 percent (3.41 percent in dollar terms) compared to 34.19 percent (33.4 percent in dollar terms) in 2018.
Despite this, market capatilisation increased in from K1.2 trillion in 2018 to K1.4 trillion in 2019.
Reacting to the market performance, Bridgepath Capital Limited chief executive officer Emmanuel Chokani said in an interview the business environment in 2019 was hostile and did not spare the stock market.
“Coupled with the political impasse, things just worsened such that Masi was just minimal until November and only rising to 4.38 percent in December when some counters picked,” he said.
But Alliance Capital Limited research manager Bond Mtembekeza said the poor performance in 2019 was largely because there was a mismatch between demand and supply as offers outpaced bids, with many investors, especially retail investors unwinding their positions at a discount. MSE operations manager Kelline Kanyangala said the stock market will continue with its efforts to court and list more companies on the local bourse.
She said: “Our efforts are guided by a five-year strategic plan that is being implemented.
“We are confident that we will build on our momentum and continue to bring in more listings.”
During the year, National Bank of Malawi plc, Mpico Limited, NBS Bank, Press Corporation Limited (PCL) and Icon Properties were top gainers.