Come to the stock market for capital

Come to the stock market for capital

Paul Bwiso Uganda Securities Exchange tells manufacturers recovering from COVID-19 pandemic stress
Kampala, Uganda | JULIUS BUSINGE | As manufacturers weather the tough times caused by COVID-19 lockdown and related restrictions, executives at the Uganda Securities Exchange say, doors are open for raising capital to reboot business activities.

Speaking on behalf of the USE Chief Executive Officer at a virtual meeting titled ‘diversifying financing sources for manufacturers’ on Oct.07, Alison Kwikiriza Serucaca, said the bourse maintains its stance on providing a platform for companies to access capital for future financing opportunities, enhancing market value for companies and accessing institutional and professional investors, improving liquidity for shareholders and boosting business efficiency in line with disclosures. The other opportunities have to do with increased brand equity locally and in the EAC region.

There are three investment market segments for manufacturers to exploit on the Nakawa based market. One is the ‘main investment market segment’ which is the largest platform the exchange offers for entities.

“All generic benefits of financing using equity exist on this platform,” Kwikiriza said. She added that unique to the USE are the tax benefits, prestige, a better investment rating and a resultant ability to generate unlimited finance from investors.

The other market segment is ‘growth enterprises market segment.’ This targets companies that have ability to grow revenues.

Kwikiriza said, these could be mature entities or companies in the startup phase as long as there are strong prospects of acceleration in growth once funds are received.

Unlike conditions or requirements for listing on the MIMS, the requirements for GEMS are more relaxed. This segment targets small and medium enterprises that form the majority of Ugandan enterprises. But it is yet to boom as companies continue to deal with changes in their business plans.

The other market segment is ‘fixed income securities market’ which is a platform for fixed income/government securities.

This market aims at providing a separate independent market for companies wishing to raise financing through issuance and listing of fixed income securities such as treasury bonds, corporate bonds, preference shares and debenture stocks.

It also provides the market for investors wishing to trade securities at the exchange.
The current value proposition for the USE has 17 listed companies, of which eight are cross listed on the other EAC securities exchange especially the Nairobi market.It has 65 treasury and corporate bonds. Total capital raised so far is Shs2.2trillion, of this amount, initial public offers account for Shs1.4trillion, secondary […]

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