Managers of the Ghana Stock Exchange (GSE) have called on Government to reduce its holdings in companies which are both listed and unlisted in its bid to increase revenue this year.
They also advised Government to allow state-owned enterprises to go onto the capital market to raise funds for their operations.
Ekow Afedzie, Deputy Managing Director of the GSE, who made the call when he briefed journalists yesterday on the first quarter performance of the Accra Bourse, also suggested a law on capital market local content.
‘A policy directing to such a development will enable Ghanaians become part owners of companies and create wealth for them and also help to deepen the depth of capital market. We expect the first quarter momentum to be sustained.’
Kofi Yamoah, Managing Director of GSE, in a presentation, revealed that an insurance firm, Agricultural Development Bank (ADB) and a cedi-denominated bond by the International Finance Corporation (IFC) were expected to list on the bourse by September this year.
According to him, the IFC had submitted a draft prospectus to both the GSE and the Securities & Exchange Commission (SEC).
‘We have reviewed and given them our initial assessment. Prior to submitting the prospectus to us, they have secured all the necessary approvals and principles. They have also been granted the needed regulatory approval from the Bank of Ghana.
GSE for the first quarter made a return of 44 percent to investors. Total market capitalization was GH¢57.74 billion with the domestic market making GH¢6.67 billion.
Volume traded was 68.12 million valued at GH¢71.5 million. GSE has been adjudged as the best performing market in sub-Saharan Africa by Bloomberg.
34 companies are listed on the GSE. With 7,914 transactions and listed government bonds totaling 92, the listed bonds registered a value of GH¢7.07 billion for the first quarter.
Out of 34 companies, BOPP led the gainers in the period under review with 132 percent. Seven companies gained 50 percent and above; eleven gained above 10 percent while another eleven maintained their prices. There were only two losers during the period.
Its alternative market – GAX – is an innovative market operated by GSE which focuses on small and medium size enterprises with high growth potential. It is expected to accommodate companies at various stages of their development, including start-ups and existing entrepreneurs, both small and medium.
Listed companies in the alternate market will enjoy support through the GAX/SME listing support fund which will assist companies to meet the upfront cost of advisors.
‘The fund has been set up with initial contributions from Africa Development Bank, GSE and VCTF. It has low listing costs and a minimum stated capital of GH¢250,000 is required at time of listing.
The objective is to establish a larger market for issuers, brokers, buyers and sellers of securities by harmonization rules and the creation of a common trading platform.
By Samuel Boadi