Rwanda’s Permanent Secretary in the Ministry of Local Government Vincent Munyeshyaka rang the bell to mark the start of trading in Uchumi shares and commended the retailer for pursuing and embracing the region’s economic integration.
“Uchumi has, by this cross-listing, shown its confidence in our financial sector and the growth of our economy thus giving our people the opportunity to own a supermarket through the buying of Uchumi Supermarkets shares,” said the Permanent Secretary, adding that Uchumi’s move showed a positive outlook for the economic growth of the region.
Uchumi Chief Executive Officer Jonathan Ciano thanked the Rwanda Stock Exchange and the Capital Markets Authority for their support throughout the approval process.
He said Uchumi’s Board had been motivated by the conviction that there is good potential in the Rwandan market and that the leadership was keen to see the emergence of regional institutions that would support and give credibility to the East African economic integration.
“As our drive towards regional growth gains momentum, so has our desire to make Uchumi shares accessible to more stakeholders across the region. It is, therefore, timely and ideal that as we plan to set Uchumi branches in this market that we also empower investors here to stake a claim to the ownership of Uchumi, and all our East African Citizens should pride themselves for owing a piece of the supermarkets”, Ciano said.
Rwanda Stock Exchange Chief Chairman James Ndahiro said listing of Uchumi shares on the Rwanda Stock Exchange would pave the way for similar Rwanda companies to participate in the security market, adding that the move was very vital to the growth and deepening of Rwanda’s stock market.
“With this cross-listing, I am confident that other private sector companies in Rwanda will follow suit and put their shares on the market. We believe this now provides investment opportunities to thousands of Rwandans willing to invest in the stock market since it now makes it convenient for them to invest in Uchumi right here in Rwanda,” said Ndahiro.
Commenting on the Uchumi cross listing, Hubert Ruzibiza, Head of Services Development at Rwanda Development Board said that the cross listing is a great sign of how Rwanda is moving towards a service based economy.
“Indeed, Uchumi is operating in the retail sector and penetrating Rwanda through the Stock Exchange is also developing our financial services sector. In addition as we are also promoting regional integration, Rwanda Stock Exchange is a tool amongst others that facilitate access to markets and trade in services, said Ruzibiza adding that “we can only encourage more companies to come operate in Rwanda, as well as Rwandan companies to venture in other regional markets.”
Uchumi’ s profit before tax rose to Sh486 million in 2013, up from a profit of Sh406 million recorded in 2012 while the Earnings Per Share increased by 31pc from Sh1.03 per share in 2012 to Sh1.35 for the year ending 30th June 2013. The positive performance has been maintained for the last five years.
The remarkable growth, said Ciano, has been on the back of the successful implementation of growth strategies supported by efficient cost management, and cautious outreach approach in our region.
“We know that the value of the shares on any Stock Market reflects the actual value stakeholders attach to the business and we continue to put in place strategies to ensure we sustain our good performance going forward,” Ciano said.
The company is also seeking approvals to cross list on the Uganda Securities Exchange and the Dar es Salaam Stock Exchange ahead of the planned right issue expected to be completed before close of the year.
“We have also made submissions to these securities exchanges and the respective country capital markets regulators and we are upbeat we’ll obtain approvals to cross list in these markets soon,” Dr Ciano explained.
Thereafter the company will be seeking additional capital through a rights issue to finance its regional growth programme as the retail chain seeks to consolidate its position in the Eastern African markets.