Johannesburg Stock Exchange Ipo

Johannesburg stock exchange ipo

Johannesburg stock exchange ipo

IPOs are exciting.

For most investors, they’re the first opportunity to participate in the growth of an up and coming business. IPOs stoke public interest in the stock market. And they provide reassurance to private equity investors that they can someday exit their own ventures in a similar fashion.

Let’s take a little time to get to know the companies that debuted on African stock exchanges within the past 12 months.

You may find a few worthy of further research.

23 Recent African IPOs

1.

AFRICAN INDICES

Accelerate Property Fund (APF)
Johannesburg Stock Exchange
Market Cap: $345.4 million

Launched by a family of wealthy Bloemfontein real estate investors, APF owns a portfolio of 52 South African properties.

More than two-thirds of them are shopping malls and retail units with the most prominent being the Fourways Mall in northern Jo-burg. It presently trades at a slight discount to its net asset value of R5.90 per unit.

2.

Advanced Health (AVL)
Johannesburg Stock Exchange
Market Cap: $36.1 million

AVL operates outpatient surgery centers in South Africa and Australia. At the time of its R100 million IPO, the company had a total of just five facilities.

The proceeds of its oversubscribed listing will be directed toward the development of an additional ten outpatient hospitals.

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Investors appear keen on the story and have pushed the share price 75% higher since their debut.

3. Alexander Forbes Group (AFH)
Johannesburg Stock Exchange
Market Cap: $1.06 billion

This South African asset manager originally listed on the JSE in 1996, but was taken private by private equity investors eleven years later.

A big company, AFH’s R11.3 billion (roughly $1.1 billion) market cap ranks it among the South African exchange’s largest stocks. In coming years, it intends to expand its pension management and insurance business further into sub-Saharan Africa.

4. Ascendis Health (ASC)
Johannesburg Stock Exchange
Market Cap: $366.1 million

This South African pharmaceutical company made its first appearance on the JSE back in November.

Johannesburg stock exchange ipo

It raised some $44 million during its IPO for the purpose of acquisitions, specifically in the medical device sector. Management has made good on the promise thus far, quickly snatching up assets like Respiratory Care Africa and Pharma Natura.

The market obviously likes the company’s growth. Its shares have risen 48% since the listing.

5. Atlantic Leaf Properties (ALP)
Stock Exchange of Mauritius
Market Cap: $25.1 million

ALP invests in listed and unlisted property companies in addition to its own real estate portfolio.

It set up shop in Mauritius for tax reasons, but Europe is its area of geographic focus. Management sees particular opportunity in the UK, Germany, and France. The stock’s primary listing is on the Stock Exchange of Mauritius, but it also trades on the JSE’s Alt-X.

6.

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Attacq (ATT)
Johannesburg Stock Exchange
Market Cap: $1.33 billion

A real estate growth fund, ATT holds a variety of commercial and light industrial properties. Key assets include the Waterfall Business Estate in Johannesburg and the Bagatelle Mall in Mauritius. The company is making an ambitious move into Ghanaian and Zambian retail properties.

So far, its strategy appears to be paying dividends.

Johannesburg stock exchange ipo

Attacq’s net asset value improved nearly 20% in the first half of 2014.

7. Caverton Offshore Support Group (CAVERTON)
Nigerian Stock Exchange

Caverton operates a fleet of helicopters and ships that provide logistics support to Nigeria’s numerous offshore oil and gas rigs.

Johannesburg stock exchange ipo

The rationale behind the $197 million listing was to broaden the company’s shareholding as it prepared to enter new markets in the region. Judging from the price movement since its shares hit the market, the listing also allowed lots of existing shareholders to jump ship. The stock dropped precipitously immediately after the May IPO and now trades 47% lower than its offer price.

8.

Johannesburg stock exchange ipo

Computer Warehouse Group (CWG)
Nigerian Stock Exchange
Market Cap: $77.9 million

With operations in Nigeria, Ghana, Cameroon, and Uganda, CWG is the largest ICT company to list on the Nigerian Stock Exchange.

Providing IT infrastructure and support to banks has been its key area of focus. CWG systems handle 60% of all banking transactions in Nigeria. Its $86 million IPO in November 2013 was well-received initially, but after a lackluster start to the 2014 fiscal year the shares dropped 9% below the offering price.

9.

Equites Property Fund (EQU)
Johannesburg Stock Exchange
Market Cap: $105.1 million

EQU owns a portfolio comprised mainly of industrial properties in South Africa’s Western Cape province. The REIT’s current tenants include Puma, Foschini, and Adidas.

A Quick Introduction to 23 Recent African IPOs

Going forward, management intends to quintuple in size over the next five years. To do this, it will geographically diversify its holdings to include warehouse properties in Johannesburg and Durban. EQU’s June 2014 listing attracted a 200% over-subscription.

10.

Freedom Property Fund (FDP)
Johannesburg Stock Exchange

Unlike a REIT, which distributes the majority of its income to shareholders, FDP will plow its profits into growing its diverse portfolio of properties. Headed by a former director of heavyweight real estate firm, Growthpoint Properties, Freedom’s sharpest focus is on low and middle-income residential developments near mining towns. The market has beaten up FDP shares since their June listing, dropping from an IPO price of R1.00 per unit to just R0.50 today.

11.

Infinity Trust Mortgage Bank (INFINITY)
Nigerian Stock Exchange
Market Cap: $39.1 million

An Abuja-based mortgage lender, Infinity listed on the NSE in December 2013.

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It plans to expand its footprint into other large cities, developing residential properties, and helping to address Nigeria’s huge housing deficit. The company is also one of a few key stakeholders in the Nigeria Mortgage Refinance Company, a new entity which will package mortgages into securities for sale to pension funds and other large institutional investors.

12.

Lottotech (LOTO)
Stock Exchange of Mauritius
Market Cap: $136 million

LOTO operates the Mauritius National Lottery, which the national government uses to fund a wide range of community development programs in addition to debt service.

With over 75% of Mauritians participating in the lottery, Lottotech has unsurprisingly put up stellar earnings numbers.

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Its net income more than doubled during the first half of 2014. And investors have taken notice.

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The company’s share price is up over 99% so far this year.

13. Madison Financial Services (MFS)
Lusaka Stock Exchange

A Zambian insurance company and asset manager, MFS listed on the Lusaka Stock Exchange this summer to, in part, allow the IFC, one of its largest investors, to make an exit. The broader base of shareholders after the IPO will also allow the company to obtain a deposit-taking license, clearing the way for it to become a micro-finance bank.

The prospectus reveals an impressive record of earnings growth in recent years. Net income surged nearly 57% in 2013.

14.

JSE Listings Requirements training with Marian Gaylard

Maendeleo Bank (MBP)
Dar es Salaam Stock Exchange

A project of Tanzania’s Evangelical Lutheran Church, Maendeleo Bank opened its doors for the first time in August 2013 with a mission to provide banking services to under-banked communities. It launched its IPO in the same month, with the goal to raise sufficient capital to sustain its operations. The offer was oversubscribed and management opted to make use of a green shoe option which allowed them to sell 1.2 million additional shares.

All told, the micro-lender raised $2.8 million and the shares are up 20% since the listing.

15.

10 companies in Africa that might go ahead with their IPOs in 2019

Mega African Capital (MAC)
Ghana Stock Exchange

With a market cap of just $8 million, Mega African Capital isn’t very big, but it is the first Ghanaian IPO since the 2008 listing of UT Bank. The investment company takes long-term stakes in publicly-traded African stocks.

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It’s got an experienced management team with an enviable track record. The partners helped set up and manage EPACK, a top-performing Ghanaian mutual fund.

16. Nairobi Securities Exchange (NAIR)
Nairobi Securities Exchange

This month, the NSE became the second African stock market to list its own shares.

Management intends to deploy the capital raised during its heavily oversubscribed IPO on debt reduction and improvements to its IT infrastructure and product offerings. The exchange has seen its fortunes rise thanks to growing trade volumes. After accounting for non-recurring gains in the prior period, the NSE’s first half pre-tax profits climbed 46%.

17.

Prima Reinsurance (PRIMA-RE)
Lusaka Stock Exchange

One of three Zambian reinsurers, Prima Re has grown steadily since its 2007 launch thanks to increasingly stringent underwriting requirements from large foreign competitors.

Being closer to the ground, Prima Re believes it has a more realistic view of potential risks. Moreover, its small size allows it to take on risks that aren’t economically viable for larger reinsurers. The company’s $4 million IPO allowed it to meet new minimum capital requirements and provides it with the heft needed to take on larger deals.

18.

PSG Konsult (KST)
Johannesburg Stock Exchange
Market Cap: $788.5 million

PSG Group spun this specialist asset manager and insurer off in June 2014 but retains a 63% stake.

The company, which had for many years traded on the OTC exchange, grew its assets under management by 38% and its underwriting premium by more than 500% during its 2014 fiscal year. Shares of PSG Konsult also trade on the Namibian Stock Exchange after a secondary listing there in July.

19.

Safari Investments (SAR)
Johannesburg Stock Exchange
Market Cap: $122.8 million

A retail-focused REIT, Safari owns shopping centers in lower income areas of South Africa’s Gauteng Province and is participating in the development of a waterfront project in Swakopmund, Namibia.

Units of the company have retreated nearly 9% since the REIT’s IPO in April.

20.

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Seplat Petroleum Development Company (SEPLAT)
Nigerian Stock Exchange
Market Cap: $2.32 billion

Seplat holds a 45% stake in three big Nigerian oil fields. When it successfully raised $500 million during its April IPO on the Nigerian and London Stock Exchanges, it became the first upstream oil company to list on the NSE.

Management intends to use the IPO proceeds to acquire onshore oil assets cast off by international energy companies eager to leave the Niger Delta region. The shares have fared well post-listing and are now up 18%.

21. Swala Oil and Gas Tanzania (SWALA)
Dar es Salaam Stock Exchange

Australia-based oil and gas explorer, Swala Energy, listed a 10% stake in its Tanzanian unit in July.

The IPO was intended to allow Tanzanian investors to participate in the exploration and development of offshore natural gas reserves, and the $3.52 million raised will be used to fund seismic studies on promising gas deposits.

Investors jumped at the opportunity. The offer was heavily oversubscribed and the shares soared 42% since listing.

22. Tharisa (THA)
Johannesburg Stock Exchange
Market Cap: $641.3 million

Based in Cyprus, Tharisa is a platinum and chrome producer that operates an open pit mine in Rustenberg, South Africa.

It was forced to reduce its April capital raising by half due to negative investor sentiment concerning the industry, but the share price has more than held its own since then, rising by 8%.

23. Visual International Holdings (VIS)
Johannesburg Stock Exchange
Market Cap: $7.9 million

This Cape Town-based company focuses on the development of mid-range residential suburbs.

It then sells the developments on to investors or adds them to its portfolio of rental income generating properties. Its premier property is Stellendale Village located just to the north of Cape Town. Management forecasts earnings growth of 19% over the long-term.

It’s Your Turn

Have I missed any recent African IPOs? Which ones do you find most intriguing? Let’s hear your thoughts in the comments!

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