The unrelenting stock-market bull run demands some respect as it has been on the rise for 10 consecutive weeks on the back of increased local demand and reduced foreign selling.
The gains in most stocks coupled by increased demand powered the Industrial index to 171.73 (+1.35 points). Outstanding gains for the day were in CFI (+8%), FBCH (+8%), Mash (13%) and Zimpapers (25%). Activity the Minings category improved albeit all counters trading flat. Falgold, Hwange and RioZim traded at 1c, 2.35c and 55c with 15,000, 6,781 and 68 shares exchanging hands respectively. The resources sector closed unchanged at 69.63 while turnover came in at $1,458,021
Econet, as has become the norm over the past weeks carried the day with 1,555,356 shares exchanging hands at 36.50c (+0.5c). Lafarge also joined the party, the French headquartered cement producer added 0.05c to trade at 40c with 1,581,764 shares changing hands. Lafarge, chief executive officer, Amil Tantawi yesterday highlighted how the firm’s revenue was down 15% as at March 2017 mainly due to the incessant rains season that weighed down demand for their product.
She however added that the cement producer’s revenues have been on the rebound since April with demand expected to increase in the second quarter.
Axia reversed yesterday’s losses and traded 0.10c in the green at 8.70c with 109,031 changing hands. Bankers, Barclays and CBZ traded flat at 3.40c and 9.54c with 118,000 and 1,972 shares changing hands respectively. While FBC added 1c to close at 13c with 5,960 shares changing hands. Fidelity traded flat at 11.50c with 939,871 shares changing hands.
CFI continued to march in the positive, the Agro concern notched up 1.13c to trade at 14.18c with 69,304 shares changing hands. The counter closed higher at 14.25c with increased demand. Colcom traded 2c firmer at 40c with 3,546 shares changing hands. The meat processer is set to be delisted from the ZSE. Delta traded 0.63c firmer at 100.65c with 11,270 shares exchanging hands. The counter closed lower at 101c.
Hippo added 0.25c to close at 55.50c with 171,438 shares changing hands. Meikles traded 0.95c stronger at 26c with only 5000 shares exchanging hands. Old Mutual continued to rally, the Insurance giant inched up 0.43c to trade at 377.43c.
The counter closed higher at 380c on the back of increased demand for the stock. Padenga who are up 33.13% year to date added a further 0.05 to close at 21.30c with 9,592 shares changing hands. Mashonaland Holdings added 0.21c to close at 2.01c with 57,307 shares changing hands. Zimpapers traded 0.25c firmer at 1c with 63,918 shares changing hands
Although most counters recorded gains a few stocks traded in the red. Seedco reversed yesterday’s gains and lost 0.34c to close at 101c with 1,776 shares changing hands ahead of its results briefing on Thursday. Simbisa was down 0.01c at 18c with a mere 1,230 shares changing hands. Star Africa traded 0.02c weaker at 1.18c with 86,400 shares changing hands.
Zimbabwe Revenue Authority has surpassed gross and net revenue collections for May due to various enhancement measures it is pursuing although it remains to be seen whether the improved flow is stable and long lasting.
In a statement, Zimra said revenue targets for May were surpassed by 17% at gross and 11% at net due to intensified audits and enforcement activities, improvements in operational efficiency, and client engagement initiatives that are being undertaken to enhance revenue collections. Gross revenue collections for May amounted to $307.3 million against a target of $262.21 million, while net collections after refunds were at $290.68 million.
Zimra also surpassed the cumulative target of $1.338 billion for the period 1 January to 31 May 2017 after gross and net collections amounted to $1.428 billion and $1.364 billion respectively. Year-to-date gross and net collections as at 31 May 2017 were, therefore, 7% and 2% above the target respectively.
In Q1, Zimra exceeded target after gross collections amounted to $862.47 million and net collections stood at $826.63 million, against a target of $812.94 million.
Acting commissioner general Happias Kuzvinzwa said: “The sterling performance was attributed to a battery of revenue enhancement measures implemented by the Authority, which include automation, greater enforcement, the fight against corruption and the rolling out of the electronic cargo tracking system.”
Corporate Income Tax collections were $35.08 million against a target of $9.90 million, resulting in a positive variance of 254%. During the period under review collections under this revenue head rose by over 460 % from $6.26 million attained same period last year.
Gross collections from VAT on Local Sales amounted to $63.12 million exceeding the target of $55.6 million by 14%. VAT refunds for the month of May 2017 amounted to $16.5 milliom, resulting in net collections of $46.5 million while net VAT collections were, 16% below the target. However, the revenue head (net collections) grew by 19% from $39.05 million that was collected in May 2016.
Collections from VAT on Imports for the month of May 2017 were $37.39 mln, which is 31 % above the targeted $28.50million Revenue collections under this revenue head rose by 32 % compared to $28.2millionrealised same period last year. “The positive performance of the revenue head can be attributed to an increase in foreign currency allocations to banks by the Reserve Bank of Zimbabwe to meet critical foreign payments.” said Kunzvinzwa
Customs Duty gross collections for the period amounted to $24.98million against a target of $23.5mln, resulting in a positive variance of 6%. Net collections at $24.88 million were 5% above the target of $23.59 million .
Customs Duty refunds for the month amounted to $94,7 million while net collections rose 14% compared to $21.86 million collected in May 2016. Collections under Excise Duty were two per cent above target. An increase of 12% on exercise duty collections which stood ta $57.34 million was achieved against target of $56.2million,a performance attributed to an increase in volumes of imported fuel and the introduction of Excise Duty on paraffin.
“Paying taxes and customs duties on time and in full is a sign of patriotism and contributes to the economic development of our beautiful nation. I, therefore, urge our compliant clients to continue paying their taxes to build and dignify Zimbabwe. I wish to encourage people who are not paying their taxes to start playing their part in building the country,” said Kuzvinzwa.
Zim investment outflows up 50% to $33mln as FDI declines 24% in 2016
HARARE – The country’s investment inflows declined last year to $319 million compared to $421 million in the prior year, according to the World Investment Report released this afternoon by United Nations Commission for Trade and Development. However, Zimbabwe’s investment outflows surged 50 percent to $33 million during the same period.
Business has been complaining that the country’s indigenisation laws are an albatross to investment inflows into the country.
Last month, Confederation of Zimbabwe Industries past president, Busisa Moyo, told FinX that: “The outstanding clarifications on indigenisation continue to be a stumbling block to investors even though President Robert Mugabe made the clarifications 12 months ago and mandated Government and Parliament to align these laws.
There is still a fair amount of ambiguity around indigenisation and there is a dire need to present a seamless revised Act in line with the latest thinking in Government base on His Excellency’s Clarification in April 2016. Most investors have adopted a wait-and-see attitude or proceeded to invest in neighbouring countries and are equally awaiting with great anticipation a revised Act”.
The report noted that foreign direct investment flows to Africa continued to decline in 2016, by three percent to $59 billion and that the inflows remain unevenly distributed, with five countries (Angola, Egypt, Nigeria, Ghana and Ethiopia) accounting for 57 percent of the total.
“In Southern Africa, FDI inflows fell by 18 percent to $21.2 billion, as flows declined in eight of the ten countries in the sub-region. In Angola, FDI flows declined by 11 percent to $14.4 billion as reinvested earnings shrank. South Africa, the economic powerhouse of the continent, continued to underperform, with FDI at a paltry $2.3 billion, up 31 percent from 2015’s record low, but still well below its past average”, the report says. Botswana also recorded a significant drop, from $679 million in 2015 to $10 million last year. Mozambique recorded FDI inflows of $3.09 billion and Zambia $469 million.
It was also highlighted in the report that multinational enterprises (MNEs) from developed economies remained the largest investors in Africa, although investors from developing economies (such as China, India, and South Africa) are increasingly active. It further opined that African MNEs were also prominent in buying assets located in Africa.
“Barclay’s (United Kingdom), for example, sold its 150-year-old affiliate in Egypt to Morocco’s Attijariwafa Bank for $500 million. Liquid Telecom, owned by telecommunication company Econet Wireless (Zimbabwe), bought the South African fixed-line operator Neotel (majority owned by India’s Tata Communications) for $430 million, in a deal that will create the continent’s biggest broadband network”, the report says.
In terms of increases of foreign ownership ceilings in stock exchanges the report noted that Zimbabwe expanded foreign ownership limits, allowing foreign investors to own up to 49 percent of companies listed on the Zimbabwe Stock Exchange.
FDI inflows to Africa are expected to increase in 2017, to about $65 billion, in view of modest oil price rises and a potential upturn in non-oil FDI. The report says that growing regional integration should foster Africa’s competitive global integration and encourage stronger FDI flows.
The report further finds that 79 percent of the newly adopted investment policy measures in 2016 were aimed at investment liberalisation and promotion, while only 19 percent introduced new restrictions or regulations.
“The new investment restrictions or regulations introduced in 2016 largely reflect concerns about foreign ownership of strategic industries, national security and the competitiveness of local producers. These concerns manifest themselves not only in legislation but also in administrative decisions of host countries, particularly in the context of merger controls related to foreign takeovers”, says the report.
Meanwhile, global FDI is expected to rise by 5 percent, to almost $1.8 trillion in 2017, after retreating by 2 percent to $1.75 trillion last year.
“The new, more optimistic projections for 2017 are attributed to higher economic growth expectations across major regions, a resumption of growth in trade and a recovery in corporate profits. The modest increase in FDI flows is expected to continue into 2018, taking flows to $1.85 trillion. However, this still puts FDI below the all-time peak of $1.9 trillion in 2007”, the report says.
