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Uganda Banks Boost Trading on Securities Exchange
Financial institutions that have often dictated the direction of trading at the Uganda Securities Exchange (USE) recently announced their financial year reports.
This has translated into marginally better trading sessions at the Ugandan bourse as was witnessed by last week's total turnover leaped to Ush107m ($47,000) from the previous week's Ush63m ($27,000).
Stanbic Bank, Bank of Baroda and Dfcu Bank have all posted huge profits in their results announced recently and analysts predicted that the financial results would spur significant activity at the bourse.
Stanbic bank's shares have been the most sought at the bourse but the demand for its shares has often surpassed the supply. The counter recorded a turnover of Ush53m ($23,000) compared to the previous week's Ush32m ($14,000).
According to market experts, the fact that Stanbic bank plans to announce another bonus issue in May 2012 could be the reason as to why the counter has witnessed increased activity.
Mr. Robert Baldwin the Chief Executive Officer of Crested Securities and Stocks told the East Africa Business Week recently that it is not always a must that the announcement of financial results translates into increased activity at the bourse.
"It takes a little bit of time for the market to digest that information but with time it picks up", he said.
Experts attribute the increased demand for Stanbic shares to the fact that they are cheaper compared the other listed banks'. Stanbic's shares are trading at Ush100, Bank of Baroda's at Ush195 and Dfcu bank's shares are trading at Ush1,000.
All the banks listed at the bourse registered increased activity and apart from Uganda Clays limited, they were the main reason as to why there was almost double the activity throughout the week.
Stanbic Bank made the highest profits of more than 84 percent in pretax profits and is offering Ush4.88 per share as dividend to shareholders.
There were about 860,000 shares traded in the week and Stanbic led the way with over 511,000 shares traded.
BY EMMA ONYANGO
The East African Business Week
29 APRIL 2012
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