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Domestic Equities: Chobe the biggest gainer

Tourism operation Chobe was the only gainer during the week under review up 9 thebe to close at a 52 week high of 910 thebe ahead of the release of its interim results for the period ended 31 August  2017.

Chobe shares are tightly held and is one of the most sought after stock on the local bourse. It’s not surprising the stock has achieved a ytd growth of 18.2% and is the second biggest gainer on a ytd basis after BTCL. The tourism operator which owns Caprivi Fly Fishing Safaris, Chobe Game Lodge, Moremi Safaries, Ker & Downey Botswana among others recently added the Dinaka Safaris (Pty) Ltd, Flavoured Properties (Pty) Ltd, Horizon Deep (Pty) Ltd and Sunbelly Ventures (Pty) Ltd into its portfolio at a cost of P56mn using internal cash resources. Flavoured Properties, Horizon Deep and Sunbelly Ventures hold an estimated 18,000 hectares of adjoining land in the Hainaveld area through leases with the Tawana Land Board, while Dinaka Safari Lodge is a 16-bed lodge and uses the 18,000 hectares of land for game activities. The lodge has been operating since 2011.

We believe this acquisition is a positive step in the right direction and will give Chobe a presence in this highly sought after diverse areas of the Kalahari, Okavango Delta and Moremi Game Reserve. The leases provide considerably more certainty due to their long term nature and this is in contrast to other leases owned by Chobe which are relatively short term.

The transaction also offers Chobe marketing and operational synergies, with no material cost increases through its existing and well-established marketing and lodge support operational infrastructure in Maun. For the week 5.4mn shares worth P15.1mn were traded, down from 30mn worth P78mn which traded the previous week. As alluded to before Chobe was the only gainer while BOD, Letshego and Primetime finished in the red. Against this background, the DCI closed the week 0.23% softer at 8,959.96 points while the FCI was static at 1,581.68 points as a loss in BOD was not enough to move the index.

(Motswedi Securities)

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China’s GDP expands 3% in 2022 despite various pressures

2nd February 2023
China’s Gross Domestic Product (GDP) expanded by 3% year-on-year to 121.02 trillion yuan ($17.93 trillion) in 2022 despite being mired in various growth pressures, according to data from the National Bureau Statistics.

The annual growth rate beat a median economist forecast of 2.8% as polled by Reuters. The country’s fourth-quarter GDP growth of 2.9% also surpassed expectations for a 1.8% increase.

In 2022, the Chinese economy encountered more difficulties and challenges than was expected amid a complex domestic and international situation. However, NBS said economic growth stabilized after various measures were taken to shore up growth.

Industrial output rose 3.6% in 2022 over the previous year, while retail sales slightly shrank by 0.2% data show that fixed-asset investment increased 5.1% over 2021, with a 9.1% hike in manufacturing investment but a 10% fall in property investment.

China created 12.06 million new jobs in urban regions throughout the year, surpassing its annual target of 11 million, and officials have stressed the importance of continuing an employment-first policy in 2023.

Meanwhile, China tourism market is a step closer to robust recovery. Tourism operators are in high spirits because the market saw a good chance of a robust recovery during the Spring Festival holiday amid relaxed COVID-19 travel policies.

On January 27, the last day of the seven-day break, the Ministry of Culture and Tourism published an encouraging performance report of the tourism market. It said that domestic destinations and attractions received 308 million visits, up 23.1% year-on-year. The number is roughly 88.6% of that in 2019, they year before the pandemic hit.

According to the report, tourism-related revenue generated during the seven-day period was about 375.8 billion yuan ($55.41 billion), a year-on-year rise of 30%. The revenue was about 73% of that in 2019, the Ministry said.

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Jewellery manufacturing plant to create over 100 jobs

30th January 2023

The state of the art jewellery manufacturing plant that has been set up by international diamond and cutting company, KGK Diamonds Botswana will create over 100 jobs, of which 89 percent will be localized.

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Investors inject capital into Tsodilo Resources Company

25th January 2023

Local diamond and metal exploration company Tsodilo Resources Limited has negotiated a non-brokered private placement of 2,200, 914 units of the company at a price per unit of 0.20 US Dollars, which will provide gross proceeds to the company in the amount of C$440, 188. 20.

According to a statement from the group, proceeds from the private placement will be used for the betterment of the Xaudum iron formation project in Botswana and general corporate purposes.

The statement says every unit of the company will consist of a common share in the capital of the company and one Common Share purchase warrant of the company.

Each warrant will enable a holder to make a single purchase for the period of 24 months at an amount of $0.20. As per regularity requirements, the group indicates that the common shares and warrants will be subject to a four month plus a day hold period from date of closure.

Tsodilo is exempt from the formal valuation and minority shareholder approval requirements. This is for the reason that the fair market value of the private placement, insofar as it involves the director, is not more than 25% of the company’s market capitalization.

Tsodilo Resources Limited is an international diamond and metals exploration company engaged in the search for economic diamond and metal deposits at its Bosoto Limited and Gcwihaba Resources projects in Botswana.  The company has a 100% stake in Bosoto which holds the BK16 kimberlite project in the Orapa Kimberlite Field (OKF) in Botswana.

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