The capital market in the country has been registering a significant evolution. In the last five years alone, several companies from different fields of activity have joined the Mozambique Stock Exchange. Arko Seguros is part of this list and, by the way, the behavior of its shares has been surprising.
César Bento Madivadua, Chairman of the Board of Directors of Arko Seguros tells how the insurer has evolved since it joined the BVM.
What led Arko Seguros to want to become a listed company?
Since we emerged in the Mozambican market, our strategy has been focused on growing and transforming our business in order to lead with responsibility and sustainability, in a strong partnership relationship with brokers and agents, through a personalized service and excellence, ensuring the rapid underwriting and settlement of claims.
Being listed on the Stock Exchange not only means having access to a world of new opportunities in the financing market, it is above all an attitude of total transparency of our insurance company towards all our stakeholders, our customers, our employees. Additionally, to be present in the capital market, Arko Seguros is required to provide relevant information to the market and our shareholders, giving the insurer greater credibility in the market, a fact that is a strong sign of confidence for our customers and shareholders.
What is the balance one can make of this presence in the stock market?
The Mozambique Stock Exchange gives us access to a whole set of advantages and benefits. One of the most important gains will be the fact that it gives credibility to our accounts and the quality of our governance, thus guaranteeing public recognition, reputation and a good image for our insurer.
On the other hand, being listed on the Stock Exchange raises the confidence of potential strategic investors, namely international financial markets that want to be part of our project. The Stock Exchange is the most adequate platform for this.
Was there any kind of impact with the pandemic, at the level of stock negotiation?
The effects of the pandemic in Mozambique began to be felt as of January 2020, and the Stock Exchange, as a barometer of the economy, was not exempt from the impacts of the generalized economic growth contraction. First of all, the probable decrease in its trading volume. The impact of this phenomenon on ARKO Seguros was the variation of the offer price of the shares between 1000 – 1200 MT, postponing until later the potential valuation of the shares, which as I mentioned before, it is our expectation that they stay above 3000 MT.
Despite the timely action of the Government, in introducing policies to minimize the harmful impact of this health and economic crisis, the unpredictability of the scenario we are living through continues to influence the sharp decline in economic activity due to a demand that has also decreased, in a spiral of economic recession that no one that many consider to be inevitable.
The insurance sector in Mozambique is still in a “maturing” phase. In this sense, what does Arko seguros expect in terms of market evolution in the coming months, especially in view of the accentuated economic evolution that is expected with the beginning of the mega gas projects? And how will it position itself vis-à-vis this market?
The insurance market will play a fundamental role in supporting the entire value chain arising from the large “Oil & Gas” projects. I am referring here to the need to purchase insurance mainly by small and medium-sized companies. Using the platform of AMS – The Mozambican Association of Insurers and in close collaboration with the other affiliated insurers and reinsurers, ARKO Seguros, within the scope of the “local content” concept, will also participate in the subscription of larger risks with the concessionaires, exploring to the maximum the available coinsurance and reinsurance mechanisms, both in the national and international markets.
Given the economic dynamism that these projects will bring to the different spheres of national life, insurers will have to be more flexible, and ARKO is already taking this path.
