Rwandan market watch

Rwanda's fixed income market has seen a surge in investor interest, with a 161% oversubscription at the latest treasury bond auction. This strong demand for fixed income assets has been a notable trend in the market, amid stability in equities trading. Lyna Muganwa Kadigwa, Investment Research Analyst at BK Capital, shed light on the latest developments during an exclusive interview with CNBC Africa. The oversubscription of T-bills in Rwanda has surged by 28.3% this month alone, reaching a remarkable 161.2% increase compared to previous records. Banks have emerged as key players in the T-bills market, driven by a preference for short-term investments that drive up demand for T-bills. Additionally, the entry of new players in the pension industry is expected to further boost market activity in the future. On the equities front, Rwanda has witnessed a somewhat subdued performance post the earnings season across Eastern African economies. However, key players like BK Group and Bradirwa have shown significant movement in market turnover. Bradirwa recently announced a dividend per share of 28.7, equivalent to 100% of the PAT, resulting in an attractive dividend yield of 16.4% as of the latest closing price. This surpasses the yield on the 20-year government paper, underlining the allure of the stock market. Notably, Banco Kigali and Bradirwa have been standout stocks, with their increasing dividends and market appeal driving heightened investor interest. As Q2 progresses, market watchers expect to see further price adjustments as investors eye the upcoming book closure dates for these stocks. The Rwanda All Share Index has also been on an upward trajectory, mirroring positive movements seen in other regional exchanges like the NSE and Dar es Salaam Stock Exchange. As stock prices continue to rise, the index is expected to reflect this growth in the market. In the currency market, the Rwandan franc has shown signs of stabilization in recent weeks, reversing previous depreciation trends against the US dollar. While the franc is not likely to strengthen significantly in the near term, policies implemented by the National Bank of Rwanda have helped to curb depreciation rates. With the Fed hinting at potential rate cuts, there is optimism for a more positive outlook, barring any unforeseen geopolitical tensions. Looking ahead to Q2, expectations are high for an increase in Rwandan GDP and a decrease in inflation rates. The recent monetary policy statement indicates a positive outlook for the economy and continued growth in the stock market, emphasizing the promising trajectory of Rwanda's financial landscape.