The Mozambique Stock Exchange (BVM) showed an upward trend in all stock market indicators, both in relation to the same period last year and in relation to the last quarter of this year.
During the Economic Briefing of the CTA – Confederation of Economic Associations of Mozambique, which took place on 9 November, Salim Cripton Valá, chairman of the board of directors of BVM, presented a detailed analysis of the performance of the capital market in the third quarter of this year and the outlook for future developments.
As far as the stock market’s performance is concerned, the trend is clearly positive. “There was an increase in all the indicators, without exception, compared to the same period last year and also compared to the second quarter, especially Corporate Debt (+53.8 per cent), Turnover (+38.8 per cent) and the Liquidity Index (+36.2 per cent).” Specifically, market capitalisation (the market value of companies and securities), accumulated up to the end of September, rose 25.3% to 178 billion meticais and is now worth 25% of GDP (a percentage that was only 21% a year ago), while turnover (total transactions) grew 40% to 19.3 billion meticais. Compared to the previous quarter, both indicators also improved: +1.8% market capitalisation; +38.8% turnover.
Number of listed securities has already exceeded this year’s target
The number of listed securities by the end of the third quarter also rose to 76 (66 in the last quarter and 58 in the same period last year), above the target of 72 set for the end of 2023. The number of listed companies remained at the 13 recorded in the previous quarter (two more than in the same period last year) on the equity side, while corporate debt rose to 20 (seven more than in the second quarter).
In terms of financing the economy, the stock market’s contribution totalled 303 billion meticais (up 21% on the previous year, but only 3% on the last quarter), of which 84% went to the state and 16% to the private sector. Finally, the liquidity index (turnover) rose to 10.83 per cent, better than the 9.7 per cent of the same period in 2022 and, above all, the 7.95 per cent recorded in the previous quarter.
According to Salim Cripton Valá, another highlight of this quarter is the 11 new issues, five of which were commercial paper, four treasury bonds and two corporate bonds, totalling 9.8 billion meticais. “Commercial paper issues have grown remarkably. They are an important short-term financing instrument for companies that has been little utilised, given that there were no issues either in the previous quarter or in the same quarter of 2022.”
It should be noted that the five issues, which totalled 1.18 billion meticais at an average interest rate of 18.63%, were issued by just three companies: Banco BiG (1), Bayport (3) and MyBucks (1).
Fewer Treasury Bond issues, with lower interest rates
The balance is less positive for Treasury Bonds (OT). “40 per cent fewer OT were issued compared to the same period in 2022, which is a trend towards reducing the stock of domestic public debt. There was also a drop in interest rates, given that the four new OT issues were made at an average rate of 16.12 per cent, whereas in the same quarter, interest on previous OT issues was paid at an average rate of 18.74 per cent.”
With regard to Corporate Bonds, the two issues totalling 774 million meticais paid interest at the highest weighted average rate of 22.93%, while Corporate Debt paid interest on previous issues totalling 89 million meticais, at an average rate of 18.8%.
In terms of company highlights, CDM – Cervejas de Moçambique had the highest trading volume (4.25 million meticais), followed by CMH (Companhia Moçambicana de Hidrocarbonetos) and HCB (Hidroeléctrica de Cahora Bassa). During this period, the Central de Valores Mobiliários (CVM) registered 51 corporate events – 34 relating to interest payments, two to dividend payments, one to capital amortisation, one to a share capital increase and 13 to the registration of new securities).
