Times Of Swaziland: ESE ALL SHARE INDEX RECORDS 0% GROWTH

ESE ALL SHARE INDEX RECORDS 0% GROWTH
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Mhlengi Magongo on 22/06/2022 08:13:00


MBABANE – The all share index of Eswatini Stock Exchange (ESE) records no
growth in the past two weeks.
This has forced the ESE market capitalisation to remain stagnant at E4 293 186
644. Market capitalisation refers to the total value of all a company’s shares
of stock. It is calculated by multiplying the price of a stock by its total
number of outstanding shares. Nedbank Eswatini yielded no gains which forced
their market cap to remain at E298 770 363. Swazi Empowerment Limited (SEL) have
a market capitalisation of E666 000 000. The Royal Eswatini Sugar Corporation
(RES) have the highest market capitalization of E1 464 467 104.
At this rate, RES is likely to have a larger share of dividends in the current
financial period. Dividends now paid directly to bank accounts.
Dividends
The ESE has announced that dividends from local companies listed in their
markets should be paid directly to client’s bank accounts. ESE said this was
in line with the Central Bank of Eswatini’s (CBE) media statement issued July
20, 2021, announcing the elimination of cheques as a mode of payment effective
from January 2022. ESE said the announcement by CBE does not affect the role of
the broker in the transaction of dividends as they are expected to make sure
that shareholders are taken care of. ESE analysis department said brokers need
to make sure that client’s bank accounts are active. They said the role of the
broker remain crucial despite the cancellation of the cheques as they are
expected to make sure the dividends are received by the shareholders.
Payments
“Nothing much will change between the broker and shareholders as the change
will only affect the process of payments which the broker will be accounted
for”, they said. They also mentioned that the dividends are released by the
companies and they will then transfer them to the shareholders who afore had to
collect cheques. A majority of investors in Eswatini both as individuals and
companies use the buy and hold strategy when buying stock on public listed
companies under ESE.
Analysis
They seek out undervalued stocks and buy them with the intent to hold on to
these positions for months, if not years with the intent to benefit from the
company’s dividends. This was mentioned by ESE analysis department in an
interview with this publication. They said they have seven enlisted companies
under ESE, but most investors use the buy and hold strategy which is beneficiary
to the dividends. ESE said investors come with the mantra of ‘buy low, sell
high,’ and seek out undervalued stocks and buy them with the intent to hold on
to these positions for months, if not years.
They said this is because investors believe the company’s management and
performance supersede all the chaos and flux that is inherent in the market, and
in time, the stock will reward them with a large return on their capital. “A
buy and hold strategy is a long-term, passive strategy in which investors keep a
relatively stable portfolio over time, regardless of short-term fluctuations”,
said ESE. SEL declared an interim dividend of E38.3 million to ordinary
shareholders registered as such in the company’s share register at the close
of business on or before May 20, 2022.
Shareholders
RES Corporation has declared a final dividend of SZL65 million to ordinary
shareholders registered as such in the company’s share register at the close
of business on or before May 6, 2022. SBC Limited has declared an interim
dividend of E30 million to ordinary shareholders registered as such in the
company’s share register at the close of business on or before Friday,
February 18, 2022. SEL also declared a final dividend of E23.7 million to
ordinary shareholders registered as such in the company’s share register at
the close of business on or before February 7, 2022.