Rwandan market watch

The Rwandan equities markets have been experiencing a positive trajectory, with both the Rwanda Share Index and the Rwanda All-Share Index recording gains of 0.1% each. This has taken the year-to-date performance to gains of 3.9% and 1% respectively. The recent performance in the market was largely driven by Bralirwa, which saw a 2.7% increase week on week. To provide more insights into these market developments, CNBC Africa was joined by Kevin Karobia, Senior Research Investment Analyst at BK Capital. Karobia highlighted the recent activity in the equities market, noting a pickup in investor interest. He specifically mentioned the performance of the BK Group Counter, which saw its share price rise to 305 Rwandan francs per share from 300 Rwandan francs per share the previous week. Despite this positive movement, Karobia pointed out that the dividends for the year 2023 remained relatively unchanged compared to 2022, leading to a slight decrease in the dividend yield to around 10.5%. One of the encouraging developments in the equities market was the increase in Bralirwa's performance, with the company closing the week 2.7% higher than the previous week. Karobia also highlighted the attractive dividend yield of 15.1% offered by Bralirwa, which surpasses other offerings in the fixed income market. He noted increased investor activity as they position themselves ahead of book closure for BK Group and Bralirwa. The T-Bills market in Rwanda has been experiencing oversubscription, indicating strong liquidity in the market. Karobia mentioned that this trend is expected to continue, especially with the baseline rates coming down. He also anticipates an influx of corporate bonds in the market, tapping into the high liquidity available. The National Bank of Rwanda (BNR) has been active in conducting market operations, further illustrating the improved liquidity. On the currency front, the Rwandan franc has been stabilizing, while the greenback has experienced a 0.2% depreciation. Karobia highlighted increased flows into the country and positive reviews from the International Monetary Fund (IMF) as factors supporting the Rwandan currency. However, challenges remain, such as the widening trade deficit, which may lead to a depreciation against the USD and regional currencies, albeit at a lower rate. In closing, Karobia noted the increased activity on counters like Bralirwa and MTN. He emphasized the importance of data revenues for MTN, especially in light of the upcoming general elections. With a focus on expanding data coverage and leveraging mobile money services, MTN is expected to perform well. Investors have shown interest in MTN, benefiting from its current underpriced status. Despite some challenges, such as cost pressures, MTN is poised to deliver value to investors in the future.