The Chronicle
Sikhulekelani Moyo, [email protected]
THE migration of listed firms from the Zimbabwe Stock Exchange (ZSE) to the USD — denominated bourse — the Victoria Falls Stock Exchange (VFEX) is not much of a concern to authorities as the platform offers entities broad investment opportunities and offers growth prospects for mid-tier and low-cap stocks on the ZSE.
From its inception in 2020, VFEX has experienced a positive momentum which has seen 14 listings with some migrating from the ZSE.
Listed entities cut across mining, property, banking and hospitality sectors.
The bourse is a subsidiary of the ZSE established to kick start the Offshore Financial Services Centre (OFSC) earmarked for the special economic zone in Victoria Falls.
It is part of efforts to attract global capital and restore foreign investor confidence in Zimbabwe’s capital markets and help companies raise capital in foreign currency.
Concerns have been raised that the migration of companies will weaken ZSE as it might be left with mid-table performances.
Zimbabwe Stock Exchange chief executive officer Mr Justin Bgoni hands over a gift to Insurance and Pensions Commission commissioner Dr Grace Muradzikwa at the ongoing Real Estate Investment Trust conference in Bulawayo.However, in an interview with Business Chronicle, ZSE chief executive officer Mr Justin Bgoni said the migration of companies from ZSE to VFEX does not undermine the stock exchange but rather gives their clients a variety of choices.
“We are comfortable with the migration of companies from ZSE to VFEX. We want to give our companies wide investment choices, so we would rather have them stay within this ecosystem than leave,” said Mr Bgoni.
“We are anticipating that more companies will be listed at the VFEX that are not migrations and our target is to have 20 companies by the end of the year.”
Mr Bgoni said the companies, which are listed at the VFEX are performing very well in terms of paying dividends and share price.
Market analysts have also observed that the migration of firms offers growth opportunities for mid-tier and low-cap stocks on the ZSE.
VFEX has become a critical component of Zimbabwe’s ongoing efforts to revitalise its capital markets and attract global investment by providing a platform that caters to foreign investors and offers stability in a hard currency ecosystem, the exchange is stimulating economic growth and fostering a supportive investment environment.
The Ministry of Finance and Economic Development has appreciated the great work by ZSE and VFEX management in attracting new players and said the Government expects more listings this year.
The Government has committed that the VFEX will remain a foreign exchange market in line with Vision 2030, which requires a lot of foreign investment as the country needs a vehicle that will make it attractive to foreign investors hence the VFEX, which has tax benefits. — @SikhulekelaniM1
