One of Zambia’s prestigious and Lusaka Securities Exchange – LuSE listed entities Zambian Breweries Plc a wholly owned subsidiary of global brand AB InBev just made its debut to Africa’s top 250 with a market capitalization of $538 million. This was according to a recent list compiled by the Africa Business Magazine. It’s the first time a Zambian entity has made it to the list.
THE GRAVITY OF THIS DEVELOPMENT
Zambian Breweries joins the star studded list of 119 South African, 34 Egyptian, 14 Kenyan, 9 Zimbabwean, 4 Tanzanian, 1 Malawian, 1 Mozambican nations.
WHAT THE TOP 250 AFRICA REFLECTS
By looking at the list it is easy to reflect the business climate and policies around the dominant nations such as South Africa with outliers in nations like Zimbabwe who despite having had tough economic conditions still have a higher number of entities compared to nations such as Rwanda that are fast growing. It spells the business maturity profiles and growth rates above all the depth of the capital markets. Entities that haven’t made it to the list are highly likely from nations whose currencies have significantly depreciated as the list ranks by dollar value disadvantaging at conversion. However, the list also tells a story of Africa’s business risks, investment potential and trade economics from a sector perspective. A typical example is how banks in East Africa dominate the list reflecting how well capitalized they are. Densely populated regions have successfully boosted telecommunications business such as MTN, Safaricom as they sell data across the continent. As for Zambia, the macroeconomic environment has weighed capital market development hence depressed appetite for stocks and corporate debt for capital raising purposes hence only one entity, the celebrated Zambian Breweries Plc. We expect in the next few years the likes of Trade Kings that have won two accolades so far as one of Africa’s fastest growing company’s off course not listed though. We can also use the Africa top list to proxy the business pulse maturity profile of African nations. It is exciting for Zambrew as a morale booster especially that it is competing in size against and is part of the 250 corporates from the 55 African nations.
It is humbling to see a Country Director Moran appreciating the shareholders and above all the hard work of his human capital that has worked tirelessly to increase shareholder value over the years.
“We are a growing company with top class quality of service and products for our consumers. This has allowed us not only to excel in the industry we operate in. Our brands continue to rank top and are preferred by consumers.”
He added that the ranking of Zambian Breweries among Africa’s Top 250 companies was important because it indicated to investors that the company was growing. Mr Moran said the ranking of the company was also made possible by the commitment and hard work of employees who put in a lot to ensure that the company was living up to the expectations of its investors and communities.
REGIONAL MARKET CAP SKEW
NORTH AFRICA: The largest represented with market capitalization of $98 billion
WEST AFRICA: Many of the star economies for 2019 and future years are in the region, with growth set to benefit from relative political stability, improving prices for oil and other commodities, and ever closer links between the economies.
EAST AFRICA: has very strong investment prospects with Ethiopia’s top growing economy, with growth forecast at 7.7% for this year and more than 100m people, but has no listed companies on the Top 250. That could start to change in coming years, as Prime Minister Abiy Ahmed has led calls for the establishment of a functioning capital market by 2020.
SOUTH AFRICA: Share is starting to fall. The bulk of Africa’s Top 250 by market capitalisation are listed on the JSE and based in South Africa or internationally in UK, Switzerland and other countries.
Editorial note by Mutisunge Zulu (BT Non Executive Chief Markets Analyst/Advisory Board Member) extracts from the Africa Business Magazine are referenced.
