Kenyan blue chips lift Uganda stock market valuation
Posted Tuesday, January 1 2013 at 16:44
- About seven Kenyan firms are cross-listed on the Ugandan exchange out of a total of 15 companies that are traded on the bourse.
- Between January and December 2012 the USE’s market capitalisation increased by 36 per cent to $5.81 billion from $4.26 billion, driven mainly by the strong performance of Kenyan stocks.
“Most cross-listings were made on a public relations basis. Quite a number of (Ugandan) firms did not participate in the initial public offers,” said Mr Kitariko.
The requirement that a local stockbroker must have a counterpart on the other side to buy and sell on their behalf makes it difficult to trade in a short time.
“Cross-listed stocks still face a challenge in being tradable,” said Robert Baldwin, the chief executive of Crested Stocks and Securities, a Ugandan brokerage house.
The NSE and the USE have said that they are working on changes to make trading of cross-listed shares the same as any others.
“A proposal for an inter-depository transfer process awaits approval by our regulators. I wish to assure the shareholders of Umeme Holdings that once the process is approved, investors will trade their Umeme Holdings shares on the NSE, as easily as they are traded at the USE,” said NSE chief executive Peter Mwangi at the Umeme cross-listing ceremony early last month.