津巴布韦股市近况

henry

Zimbabwe: Stock Prices Fall As Investors Pull Out



The Herald (Harare)

ANALYSIS
9 July 2007
Posted to the web 9 July 2007

Harare

THE stock market began last week's trading on a recovery note but apprehension in the markets following the prices crackdown saw the risk averse investors pulling out leading to a fall in stock prices for the rest of the week.

The previous week's loses were followed by a modest recovery of prices on Monday and Tuesday as liquidity started to improve on the money market.


Following the cut in prices people suddenly found themselves in need of cash and quite a number of individual investors on the bourse pulled out to join the rush for cheaper goods on the shelves.

Apart from the individual investors pulling out, there is now some negative sentiment that is being attached to the bourse given that over 70 percent of the listed firms have been affected by the price crack down.

While it is a known fact that the ZSE in its crazy bull run in the past few years has respected no fundamentals at all, the consequences of last week's developments will be a bitter pill to swallow for most firms particularly those in the retail sector.

It might also not be surprising for investors to lose confidence in most counters and thereby lead to a massive exodus from the bourse.

However, I am of the opinion that the slide in the stock prices is just a temporary trend which will be reversed soon, as the stock market is the only inflation beating investment vehicle in the country.

As money market rates remain way below the inflation rate, investors will have no option but to come back to the bourse.

On a year to date basis the main index has risen by over 7 000 percent while the resource index has surged a heavy 5400 percent since the beginning of the year.

Looking at other developments on the ZSE, last week saw FML being suspended from the bourse for the second time in the past three years.

The Life assurance giant never seems able to keep itself out of trouble and this time it has clashed with the ZSE committee for trying to go ahead with a deal that had been blocked by the authorities.

I understand now that FML has dragged the ZSE to courts for unfair suspension and therefore I shall not comment about this issue any further for now .

The ZPI initial public offer is also of keen interest on the bourse.

The initial share price has been set at $1500 per share, almost double the initial proposed price of $720. The market sentiment, however, is that the share price is going to move to greater levels on the back of the bullish nature of the stock market this year.

The last listing on the local bourse was that of Redstar in January 2007.

Currently, ZPI has a portfolio in Harare consisting Nicoz House, Wetherby House, Old Shell House, Zimra Centre, Roadport, Chinhoyi Street Redevelopment site, Uniprops, Valiben properties and Glenview stands.

It also has other properties in Bulawayo (Nicoz House), Kwekwe (TM supermarkets and other commercial stands), Mutare and Masvingo. It is important to note that prior to the IPO, ZPI acquired some properties from selected investors through private placements aimed at bolstering its capital base and creating a well diversified portfolio.

The acquisitions include the Fidelity Life Tower in Harare and other Fidelity life properties in other parts of the country.

Borrowdale Brooke cluster houses were acquired from Imara Asset Management.


According to a Kingdom stockbrokers report, at the moment the company's strategy seems to be hinged on more property acquisitions as 72 percent of the IPO proceeds are going towards acquisitions, 18 percent to property development, 5 percent to working capital and approximately another 5 percent to expenses of the IPO.

The hyperinflationary environment currently besieging the economy has raised increasing interest in the property sector as real properties are perceived as an excellent hedge against inflation. Returns are expected from capital appreciation, trading profits and rentals therefore ZPI potentially provides good yields for investors emanating from the property portfolio.

ZPI is somewhat comparable to other counters in the property sector namely Mashonaland Holdings Limited and Dawn properties which was unbundled from Zimsun and listed in 2003. Unlike ZPI, Dawn mainly focuses on tourism owning most hotels that are managed by Zimsun.

Zimbabwe: Stock Prices Fall As Investors Pull Out

(Page 2 of 2)
On the international markets US stocks traded higher on Monday, on speculation that a home-sales report today will show signs that the housing market may be improving. As a result, the blue chip Dow Jones Industrial Average gained 0,95 percent to close at 13 535,43 points, the broader based Standard and Poor's 500 rose by a significant 1,12 percent to finish at 2 632,30 points, while the Nasdaq Composite added 1,07 percent to 1 519,43 points.

European stocks advanced in early trade, after brokerages raised their estimates for equities in the region, paced by mining companies as metal prices rose.


The London FTSE 100 rose by 0,63 percent to 6 632,10 points and the Frankfurt Xetra Dax gained 1,04 percent to 8 041,22 points. South Africa's JSE All-share Index on the day added 0,33 percent to 28 796,56 points, taking a cue from a rally in US markets.


Asian stocks were on an upward trend, with the Japanese Nikkei 225 average trading 0,02 percent firmer at 18 149,90 points, on signs of increasing demand for exports, metals and crude oil.

US markets were closed on Wednesday for the American Independence holiday. European stocks were indicated weaker in early trade on falling profits from real estate and rising interest rates.

The London FTSE 100 slid by 0,27 percent to 6 655,00 points, while the Frankfurt Xetra Dax lost 0,67 percent to 8 021,51 points. South Africa's JSE All Share Index added 0,54 percent to trade at 28 998,93 points, but it was lower than expected because of the American holiday. Asian stocks continued to boost, with the Japanese Nikkei 225 average gaining 0,29 percent to trade at 18 221,48 points, due to the rising prices of computer chips and metals.

henry

1,300 shops owners, executives arrested in Zimbabwe

July 09, 2007

ZIMBABWEAN police have arrested more than 1,300 shop owners and business executives for defying the government's orders to reduce prices, state radio said today.
President Robert Mugabe's government, concerned by rocketing prices that could trigger social unrest, had ordered shops and businesses to reduce their prices to levels used on June 18, or face arrest.

Last week price inspectors accompanied by teams of police began visiting shops nationwide ordering prices down, sometimes by as much as half under a police blitz dubbed Operation Reduce Prices.

Since the inception of the operation, police crack teams operating in conjunction with other government units have arrested 1,328 shop owners, police spokesman Oliver Mandipaka was quoted as saying in a statement.

Those arrested include company directors, general managers, restaurant and cafe owners and the manager of an exclusive clothes store.

The official Herald newspaper said most had already appeared in court and paid hefty fines.

They risk seven days' imprisonment if they fail to pay up, the paper said.

Most of the arrests occurred in the second city of Bulawayo, where 414 company executives were netted. Hundreds more were arrested throughout Zimbabwe's 10 provinces.

Police have launched a manhunt for some company officials who fled their companies, the Herald said.

Police meanwhile have threatened to extend their blitz to pharmacies, hardware stores and Harare's flea markets; informal marketplaces that many city dwellers rely on to buy cheap clothes, shoes and electronic goods.

Retailers and manufacturers say their high prices are justified amid an economic crisis marked by acute shortages of fuel, power and foreign currency and inflation of more than 4,500 per cent.

henry

1,300 shops owners, executives arrested in Zimbabwe

July 09, 2007

ZIMBABWEAN police have arrested more than 1,300 shop owners and business executives for defying the government's orders to reduce prices, state radio said today.
President Robert Mugabe's government, concerned by rocketing prices that could trigger social unrest, had ordered shops and businesses to reduce their prices to levels used on June 18, or face arrest.

Last week price inspectors accompanied by teams of police began visiting shops nationwide ordering prices down, sometimes by as much as half under a police blitz dubbed Operation Reduce Prices.

Since the inception of the operation, police crack teams operating in conjunction with other government units have arrested 1,328 shop owners, police spokesman Oliver Mandipaka was quoted as saying in a statement.

Those arrested include company directors, general managers, restaurant and cafe owners and the manager of an exclusive clothes store.

The official Herald newspaper said most had already appeared in court and paid hefty fines.

They risk seven days' imprisonment if they fail to pay up, the paper said.

Most of the arrests occurred in the second city of Bulawayo, where 414 company executives were netted. Hundreds more were arrested throughout Zimbabwe's 10 provinces.

Police have launched a manhunt for some company officials who fled their companies, the Herald said.

Police meanwhile have threatened to extend their blitz to pharmacies, hardware stores and Harare's flea markets; informal marketplaces that many city dwellers rely on to buy cheap clothes, shoes and electronic goods.

Retailers and manufacturers say their high prices are justified amid an economic crisis marked by acute shortages of fuel, power and foreign currency and inflation of more than 4,500 per cent.

henry

Mugabe's price cut fuels rush on petrol
Jan Raath, Harare
09jul07

ZIMBABWE President Robert Mugabe has ordered petrol stations to cut the price of fuel by 70 per cent in a desperate attempt to bring down the world's highest rate of inflation.


Mr Mugabe ordered the price of fuel to be cut to 42c a litre, as his politburo announced plans to "tighten and intensify" price controls.

At the weekend, hundreds of cars began queuing at service stations in Harare, the capital, after state radio announced that fuel would have to be sold at $Zim55,000 a litre. It had been selling for $Zim180,000 a litre.

"This is going to be a very short honeymoon," John Robertson, an economist, said. "There will be no fuel to be had anywhere in the country by the middle of next week. That will bring an end to all business activity. A shutdown of the entire country is coming. In a week's time, people are going to be struggling to find food."

Shops have already been ordered to reduce prices as the President seeks to beat hyper-inflation that he fears may drive him from power.

State radio called on the movement of war veterans - a reserve unit of the armed forces made up of former guerillas who fought to end white rule more than 25 years ago - the youth militia and the women's league of Mr Mugabe's ZANU (PF) party, to report to party headquarters. Observers believe the groups have been summoned to support trade inspectors, police and state secret agents in enforcing the price cuts.

Supermarkets, shops and warehouses are being forced to sell produce at prices far below the cost of replacing stock.

The operation has been accompanied by state-approved looting as hungry Zimbabweans, impoverished by Mr Mugabe's ruinous economic policies, loaded cheap goods, which were often resold on the black market the same day at far higher prices.

Lawyers have denounced the forced price cuts as illegal, yet many businessmen have been arrested for failing to comply.

"It's all by edict in the state press," said one lawyer, who asked not to be named. "Even if they did make it official, it would be in violation of the constitution, for depriving people unlawfully of their property. It is legalised looting, legalised theft."

Inflation, the highest in the world, has rocketed above 4500 per cent and four in five adult Zimbabweans are unemployed.

Mr Mugabe's onslaught is seen as a response to repeated forecasts that Zimbabwe's wild inflation will bring the economy to a halt within six months and cause civil upheaval that will drive him from power.

"Mugabe is taking these forecasts very seriously," John Makumbe, a political commentator, said. "But he thinks he can bring down inflation by manipulating it manually. He doesn't realise it will rocket even higher."

At the weekend, traders in the capital's predominantly Indian business area had placed steel-grilled gates outside their shop doors, ready to be shut at short notice. Mr Mugabe told supporters that any businesses that halted production because of the price cuts would be forcibly nationalised. "We are saying to all factory owners 'you must produce'," Mr Mugabe said. "If you don't produce, we certainly will seize the factories."

Zimbabwe police arrested 17 more business executives yesterday for defying the official price freeze, as the ruling party endorsed the Government's tough stance on businesses.

An enforcement unit has arrested more than 200 business people for breaching the price controls in the past week.

Police spokesman Oliver Mandipaka warned of a broader crackdown on business people and black-market vendors enjoying roaring trade as goods become scarce in formal shops.

"Those people who work in cahoots with economic saboteurs will have themselves to blame because our crack teams will be conducting sporadic raids on all individuals who sell basic commodities in front of shops and in their backyards at exorbitant prices," he said.

Most shops have run out of basic goods as shoppers rushed to stock up, fearing shortages as the price freeze takes effect. Now the attention of bargain-hunters has turned to clothing shops, which have also been ordered to cut their prices.

The country's leading clothing retailer, South African-owned Edgars Stores Limited, announced yesterday that it had cut all prices by 50 per cent, triggering a stampede at its outlets.

henry

Zimbabwe Announces Price Cut Law
By ANGUS SHAW 07.07.07, 10:35 PM ET



Zimbabwe's government announced a new law Saturday making it an offense to defy steep price cuts ordered in an effort to control runaway inflation and a growing economic crisis.

A rush to buy cheaper goods have depleted stores of corn meal, bread, meat and other staples since the government ordered a 50 percent cut in the price of basic goods last week. The falling prices have caused stampedes and near-riots in shops. Some businesses have shut down.

Police and government inspectors have raided businesses to force them to slash prices. The price of gasoline was also halved, creating long lines at stations - most of which were out of supplies Saturday.

Industry Minister Obert Mpofu issued an official notice making it an offense to defy the price cut edict or fail to display new price tags, state radio reported.

On Friday, police arrested 17 business leaders for flouting the order, police spokesman Oliver Mandipaka said. He said some managers had gone into hiding or taken vacation to avoid police action.

"We want to warn them we will pursue them up until they face the full wrath of the law," he said.

At least 200 businesses have already been charged with price violations, and 40 market vendors were arrested for hoarding goods.

On Friday, President Robert Mugabe threatened to seize business that defy the price cuts. He spoke before hundreds of ruling party militiamen and veterans from the guerrilla war that brought him to power in 1980 and ended British colonial rule here. He urged them to report "wayward Zimbabweans" who overcharge or stop producing.

The veterans and youth militias, known as Green Bombers for their green denim uniforms, were the main participants in the chaotic and bloody seizures of thousands of white-owned commercial farms that began in 2000.

Critics blame the land seizures for plunging Zimbabwe into its worst recession since gaining independence. Official inflation is running at 4,500 percent, the highest in the world, though independent financial institutions estimate the real rate is closer to 9,000 percent.

Earlier, police warned goods would be seized and offenders arrested, but gave no indication of penalties price-cut violators could face.

Under previous powers given to a state-appointed commission on prices and incomes, businessmen could face up to five years in jail if convicted of "economic sabotage."