RSE CEO weighs in on the listing of MTN Rwanda

Rwanda Stock Exchange (RSE) is abuzz with excitement as MTN Rwanda, the leading telecommunications company in the country with over 60% of mobile subscriptions, listed its 20% stake on the stock exchange through a direct introduction. The move has positioned MTN Rwanda as one of the biggest companies on the RSE, significantly impacting market capitalization. In an exclusive interview with CNBC Africa, Celestin Rwabukumba, CEO of RSE, shared insights on the listing and the market dynamics it is set to trigger. Rwabukumba emphasized the significance of the listing, citing the visibility it provides to shareholders and the direct access to trading shares, which were previously channeled through special purpose vehicles (SPVs). Investor interest in MTN Rwanda's listing has been on the rise since the news of regulatory approvals and exchange listings surfaced. Rwabukumba noted the immediate increase in share price post-announcement, signaling growing investor confidence and heightened interest in the RSE. Foreign investors currently dominate the RSE, mainly as institutional investors with substantial capital to deploy, whereas local investors, both individual and institutional, are abundant but often with smaller investment capacities. Rwabukumba stressed the importance of nurturing domestic investors to bolster market participation and liquidity. Addressing queries about the 20% listing compared to the 25% industry standard, Rwabukumba clarified that RSE's regulatory framework allows flexibility on a case-by-case basis, aligning listings with company needs and market demand. While 25% is the standard, companies can opt for lower floats based on specific circumstances, as was the case with MTN Rwanda's listing. The focus for MTN Rwanda was not capital-raising but facilitating trading for existing indirect shareholders to directly engage with the company. The spotlight on MTN Rwanda's listing serves as a catalyst for other companies considering going public on the RSE. Rwabukumba disclosed that RSE is actively engaged in a project to support 15 companies in their listing journey, with 12 currently undergoing improvement plans to meet listing criteria. The project aims to enhance market participation and diversify the exchange's offerings, ultimately fostering a vibrant capital market ecosystem in Rwanda. With market sentiment riding high on the heels of MTN Rwanda's listing, RSE is poised for a transformative phase in the Rwandan financial landscape. As the market witnesses increased investor interest and regulatory support for listing initiatives, all eyes are on the future prospects of the RSE and the potential influx of new listings that could further deepen the country's capital markets.