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BSE narrows losses

The Botswana Stock Exchange appears to be making a recovery from the previous year’s slump that resulted in major equities losing value. The Domestic Company Index (DCI), which tracks the performance of local listed companies, ended the first quarter of the year weaker but better than the corresponding quarter in 2016.

The DCI started the year with 9389.34 points but has since lost 164.12 points in the last 3 months to close the first quarter at 9225.22 points. This means the DCI has declined by 1.68 percent, however, this compares favourably with 2016’s first quarter decline which stood at 3.8 percent. The narrowed loss in the first quarter of the year points to a slow recovery for the BSE’s DCI that declined by 11.3 percent in 2016. Moreover, the improvement in the first quarter of the year has brought down losses in the past 12 months to 9.54 percent.

The downward pressures exerted by certain sectors on the DCI in the previous year have spilled over to this quarter as the same sectors continue to affect the overall performance of the local bourse. In its 2016 market performance report, the BSE said the DCI’s decline of 11.3 percent in 2016 was attributable to the negative performance of the Retail & Wholesaling and the Banking sectors as well as the Financial Services & Insurance and the Information & Communications Technology (ICT) sectors.

During the first quarter of the year, the DCI’s losses were led by three retail titans from the influential Wholesaling and Retail sector. Leading the losses was Sechaba, the local brewing giant, which lost 22.2 percent in the quarter under review. The blue chip stock ended the quarter to trade at P21, a decline of 30 percent from its all time high price of P30. This has extended the stock’s decline to 26.3 percent in the past 12 months. Further complicating the matter for the brewer is the tough trading conditions it finds itself operating under. The group has warned shareholders to expect lower profits.

Sefalana, another key player in the Wholesaling and Retail sector, closed off the first quarter 17.7 percent under to trade at P10.70. This stock price is now 23.6 percent off its 12 month high price of P14. Sefalana’s stock has been on a steady decline since late last year, bringing its total losses in the past 12 months to 20.6 percent. The embattled furniture and consumer goods retailer, Furnmart, continues to struggle on the stock market after losing 7.1 percent in year to date returns. The stock which is trading at 0.65t is 39.3 percent lower than its 12 month high price of P1.07.

The banking sector which has recently been boosted by higher earnings from all the listed banks is yet to reach peak performance in the local stock market. First National Bank Botswana, the largest bank in the country and also the biggest company by market capitalization, has continued the downward trend that started last year into the first quarter of the year, dropping 7.1 percent to trade at P2.75. At the current stock price, the bank’s stock value has declined by 24.7 percent in the last 12 months.

Standard Chartered Bank of Botswana might have shocked many after declaring higher profits in its end of year results but the bank’s stock price continues to be under pressure following negative sentiments from investors that have been fuelled by the bank’s previous financial performances which was marked by declining profits. The oldest bank in the country closed the quarter under review trading at P7.35, down by 5.2 percent. This has extended the bank’s losses in the stock market to 31.9 percent in the past 12 months.

Letshego was the only loser in the Financial Services and Insurance sector after dropping 5.7 percent to trade at P2.16, stretching its losses in the last 12 months to 13.6 percent. At the current share price of P2.16, the stock is trading at 19.1 percent lower than its 12 month high price of P2.67.

Other notable losses in the first quarter of 2017 include the leading security and cash management firm, G4S, which dropped 2 percent in stock value to trade at P4, which means the stock has also dropped 2.4 percent from its 12 month high price of P4.10. However the stock’s returns remain solid over the 12 months period with returns of 10.5 percent. The decline of the DCI in the first quarter of the year, and the subsequent narrowing of losses from 2016 was offset by strong performances from mostly the same companies that had held firm in 2016 when the DCI tumbled.

Botswana Telecommunications Corporations Limited (BTCL)’s spectacular rebound has led the rally in the local equities board, rising sharply by 31 percent in the last three months to end the quarter trading at P1.28. At that price, the stock is trading at a premium of 28 percent from its listing price of P1 in April 2016. The stock spent most of 2016 being battered; even reaching lows of P0.85 thebe but in the fourth quarter of 2016 the stock began its rebound buoyed by strong financial performance and attractive dividend payouts. BTCL forms part of the broader Wholesaling and Retail sector on the BSE.

Barclays Bank Botswana continues to buck the trend in the banking sector as far as stock market performance is concerned. In 2016 the second largest bank in the country became the only banking stock to appreciate in value. Barclays has extended its exploits to this year’s first quarter, registering share price gain of 13.1 percent to trade at P5.70. The stock is trading at its all 12 month high, bringing total gains in the last 12 months to 25.3 percent.

The property sector has also shown its resilience in the first quarter as it tapped on the previous year’s overall satisfying performance for the sector. New African Properties (NAP) is becoming the investors’ favourite when it comes to picking up property stocks. NAP advanced by 7.1 percent to trade P3.15, ending the quarter at its highest price in 12 months. This also brings NAP’s gains to 15.8 percent in the last 12 months. Other property stocks that did well during the quarter under review involve Primetime and Letlole La Rona (LRR). Primetime is up by 1.9 percent to trade at P3.16, taking its overall gains in the past 12 months to 6.8 percent. LLR’s share price increased by 1.8 percent in the first 3 months of the year.

Choppies, the leading local grocer, is trying to stage a comeback from the dismal performance on the BSE in the previous year. Choppies which has set its eyes firmly on regional expansion had to watch its stock price plunge by 40 percent in 2016 following declining profits. The grocer whose recent half year results show a 49 percent decline in profits will be pleased with the first quarterly performance on the stock exchange. Choppies stock ended the quarter trading at P2.55, up by 6.3 percent. Nonetheless the stock price is off its 12 month high of P4.2o, representing a loss of 37.8 percent in the past 12 months.

The less influential tourism sector has brought its delightful performance from the previous year to this year’s first quarter as all listed tourism and leisure companies recorded gains. Chobe Holdings Limited ended the quarter trading at a 12 month high of P8.03, up by 4.3 percent. This brings the tourism outfit’s gains to 16.7 percent in the last 12 months. Cresta Marakanelo Limited-which led the rally last year by gaining the most- has advanced slightly by 1.8 percent to trade at P1.30 by end of quarter. While the stock is 0.8 percent off its 12 month high of P1.31, its gains remain solid at 17.1 percent in the past 12 months. Wilderness Holdings Limited ended the first quarter with an increase of 0.6 percent to trade at a 12 month high of P5.20, bringing its 12 month gains to 6.1 percent.

The financial services behemoth, Botswana Insurance Holdings Limited (BIHL), held steady in the first quarter as the blue chip stock advanced by 2.8 percent. At the closing price of P18.05, the stock is trading at its 12 month high. In the past 12 months the stock has gained 15.7 percent. BIHL with its sprawling portfolio remains the favourite in the Financial Services and Insurance sector.

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The  Bulb World CEO selected for Africa’s prestigious award

22nd July 2021

The Bulb World Chief Executive Officer (CEO) and entrepreneur, Ketshephaone Jacob has been selected as a 2021 Top 50 Africa’s Business Hero.

Jacob was chosen from a pool of 12,000 applicants – many of whom are highly-skilled and accomplished entrepreneurs.

Africa’s Business Hero, sponsored by technology entrepreneur, Jack Ma, aims to identify, support and inspire the next generation of African entrepreneurs who are making a difference in their local communities, working to solve the most pressing problems, and building a more sustainable and inclusive economy for the future.

The initiative is as inclusive as possible and applications were open in English and French to entrepreneurs from all African countries, all sectors, and all ages who operate businesses formally registered and headquartered in an African country, and that have a 3 year-track record.

Every year, finalists are selected to compete in the ABH finale pitch competition and participate in a TV Show that will be broadcast online and across the continent.

The finalists will compete for a share of US $1.5 million in grant money.

The Bulb World, is home grown LED light manufacturing company, which was partly funded by Citizen Entrepreneurial Development Agency (CEDA) at the tune of P4 million, to manufacture LED lighting bulbs for both commercial and residential use in 2017.

The Bulb World operate from the Special Economic Zone of Selibe Phikwe. Early this year, The BulB World announced its expansion to South Africa, setting in motion its ambitious Africa expansion plan.

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Mining production down 12 % IN Q1 2021

14th July 2021

During the first quarter of 2021, production in Botswana’s economic nucleus- the mining sector contracted by 12 percent. This is according to Mining Production Index released by Statistics Botswana this week.

The country’s central data body revealed that Index of Mining production stood at 74.4 during the first quarter of 2021, showing a negative year on-year growth of 12.0 percent, from 84.6 registered during the first quarter of 2020.

The main contributor to the decline in mining production came from the Diamonds sector, which contributed negative 11.7 percentage points. Soda Ash was the only positive contributor in the mining production, contributing 0.1 of a percentage point. However Soda Ash’s contribution was insignificant to offset the negative contribution made by Diamonds.

The quarter-on-quarter analysis by Statistics Botswana experts shows an increase of 16.3 percent from the index of 64.0 during the fourth quarter of 2020 to 74.4 observed during the period under review.

Diamond production decreased by 12.1 percent during the first quarter of 2021 compared to the same quarter of the previous year. The decrease was as a result of planned strategy to align production with weaker trading conditions mostly linked to Covid-19 protocols restrictions.

Botswana’s diamond sector is underpinned by Debswana, the country’s flagship rough producer- a 50-50 joint venture between government and global mining giant De Beers Group. The other producer is Canadian based Lucara Diamond Corp through its wholly owned Karowe Mine which is a relatively small but significant production that has made a name for itself worldwide with rare diamond recoveries of unprecedented carat size.

On the other hand, quarter-on quarter analysis shows that production has improved, registering a positive growth of 17.5 percent during the first quarter of 2021 compared to the preceding quarter – 2020 Q4.

Though production was significantly lower in the first quarter, the two producers ended Q2 with rare diamond recoveries. Debswana early last month found the world’s third largest gem diamond – weighing 1098 carat at Jwaneng Mine, its flagship gem quality diamonds producer, also regarded the world’s richest diamond mine.

A week later Lucara  announced its second biggest recovery, the 1174 carat clivage near-gem dug from its Karowe Mine. The diamond is the world third in carat size after the plus-3000 carat Cullinan found in South Africa back in 1905 and the 1758 carat Sewelo unearthed at its Karowe mine in 2019. Debswana and Lucara are investing billions of pulas in underground mining projects to extend the life of its mines, Jwaneng & Karowe respectively.

In terms of Gold which is produced at Mupani mine near Botswana’s second city of Francistown output decreased by 17.9 percent during the first quarter of 2021 compared to the same quarter of the previous year.

Similarly, quarter-on-quarter analysis reflects that production decreased by 21.4 percent during the first quarter of 2021, compared to the preceding quarter. The decrease was as a result of the deteriorating lifespan of the mine as well as the impact of COVID-19 which slowed down the mining activities.

Soda Ash production increased by 11.1 percent during the first quarter of 2021 compared to the same quarter of the previous year. In terms of quarter-on-quarter Soda Ash production also showed an increase, picking up by 2.1 percent during the period under review. The increase in production is attributable to the effectiveness of the plant following refurbishment which occurred in the third quarter of 2020.

Salt production decreased by 34.0 percent during the first quarter of 2021, compared to the same quarter of the previous year. Similarly, the quarter-on-quarter analysis shows that salt production registered a decrease of 32.9 percent during the period under review. Both salt and Sodash are produced by partly government owned Botswana Ash (BotsAsh) operating from Sowa town near Makgadikgadi pans.

Coal production decreased by 11.2 percent during the first quarter of 2021, compared to the corresponding quarter of the previous year. The decrease was attributed to the reduced demand from Morupule B Power Station following the remedial works being undertaken, as one boiler was in operation during the period under review.

Although production fell, Statistics Botswana says there was no shortfall in supply of coal due to stockpiling. On the other hand, the quarter-on-quarter comparison shows that coal production increased by 20.4 percent compared to the preceding quarter.

Botswana’s flagship coal producer is Morupule Coal Mine; a wholly state owned mining company located in Palapye producing primarily for Botswana Power Corporation (BPC)’s power generation plants Morupule A & B.

The other coal producer is Botswana Stock Exchange listed Minergy which operates a 390 MT Coal Resource mine in Masama near Media in the southwestern edge of the Mmamabula Coalfields.

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Gov’t awards mining licence for Gantsi Copper Mine

14th July 2021

Department of Mines in the Ministry of Mineral Resources, Green Technology & Energy Security has awarded mining licence to Tshukudu Metals-a subsidiary of Aussie firm Sandfire Resources ,giving the company a green light to start piecing the ground at its Motheo Copper Project near Gantsi.

Lefoko Moagi, minister in charge of mineral resources in Botswana confirmed to weekendpost on Tuesday. Minister Moagi revealed that “the licence has been approved , but Sandfire Resources as a listed company will report to its shareholders and investors then make an official public statement” he said.

Based on a forecast copper price of US$3.16/lb (reflecting current long-term consensus pricing) the Base Case 3.2Mtpa – Ghantsi copper project is forecast to generate US$664 million (over P7 billion) in pre-tax free cash-flow and US$987 million (over P10 billion) in EBITDA (Earnings Before Interest, Tax, Depreciation and Amortisation), at a forecast all-in sustaining cost of US$1.76/lb over its first 10 years of operations.

In December 2020, the Board of Sandfire Resources approved the commercial development of the Motheo Copper Mine located in the Kalahari Copper Belt in Botswana, marking a key step in its transformation into a global, diversified, and sustainable mining company.

Tshukudu Metals Botswana (Pty) Limited (Tshukudu) a 100% owned subsidiary will be the owner and operator of the Motheo Copper Mine which is scheduled to produce up to 30,000 tonnes per annum of copper in concentrate over a 12 year mine life.TMB is targeting development of its Motheo Copper Mine in 2021 and 2022, with its first production in 2023.


Beginning of this year presentations were made to the Department of Mines as part of the Mining Licence approval process and to the Ghanzi Regional Council, additional information was requested by Department of Mines in April and was duly supplied by the company.

As part of the Mining Licence approval process, the Government of Botswana has a right to acquire up to a 15% fully contributing interest in all mining projects locally. Quizzed on whether government through Mineral Development Corporation Botswana (MDCB) would be taking up stake in the project Minister Moagi said, “No consideration is being made on that regard”.

“Government is not considering taking up a stake in the Ghantsi Copper Mine project, every opportunity is assessed on all risks, but Government makes money all the while from leases, taxes and royalties, remember if you take stake you are liable for liabilities of the project as well,” Moagi said.


Last month Sandfire announced that it has awarded over P5 billion worth mining contract to African Mining Services (AMS), a subsidiary of Perenti, to deliver the open cast operation.

The contract, which has an estimated value of US$496 million (over 5 billion), is the largest single operational contract for the new Motheo Project covering a period of 7 years and 3 months, with provision for a one-year extension.

The contract according to Sandfire Resources was awarded following a competitive 3-stage tender process which saw a number of key factors taken into consideration when selecting the preferred contractor.

These included Citizen Economic Empowerment, safety culture, equipment suitability and availability, commercial terms and identified improvement opportunities. Under the terms of the contract, AMS has agreed to form a 70:30 Joint Venture with a suitable local Botswana partner or partners.

The JV is expected to be finalized ahead of commencement of mining in early 2022. African Mining Services has been operating in Africa for over 30 years. AMS’ parent company, ASX listed diversified mining services group Perenti, already has a presence in Botswana through Barminco, their underground mining division, at the large-scale Khoemacau Copper Mine located 200km north-east of Motheo.

Last month Sandfire executives said the award of the open pit mining contract represents another key milestone in advancing the Motheo Project towards production, with all components of the contract in line with the key parameters outlined in the December 2020 Definitive Feasibility Study (DFS).

The company said full-scale construction of the US$279 million (over P 3 billion ) mine development is expected to commence immediately upon receipt of the Mining Licence, with mining scheduled to commence in early 2022 ahead of first production in early 2023. This week Sandfire Resources advertised over 10 positions in calling on applications from geologists, mining engineers and geotechnical engineers.

The Motheo mine has an initial mine life of 12.5 years based on production from the T3 pit. The initial development is expected to generate approximately 1,000 jobs during the construction phase and 600 direct full-time jobs during operations, with at least 95% of the total mine workforce expected to be made of up of Botswana citizens.

Later in the week Sandfire Resources announced in the company website that it has received the licence. Sandfire’s Managing Director and CEO, Mr Karl Simich, said the award of the Mining Licence represented a major milestone that would see a significant increase in construction and development activities on site.

“We are absolutely delighted to now be in a position to move to full-scale construction at Motheo, with our construction crews expected to mobilise to site over the next few days. I would like to thank the Government of Botswana for their support throughout the approvals process, which will see Motheo come on-stream in 2023 as one of very few new copper mines commencing production globally.”

Simich said the project is expected to generate approximately 1,000 jobs during construction and 600 full-time jobs during operations, and represents the foundation for Sandfire’s long-term growth plans in Botswana.

“Our vision is that Motheo will form the centre of a new, long-life copper production hub in in the central portion of the world-class Kalahari Copper Belt, where we hold an extensive ground-holding spanning Botswana and Namibia,” he said.

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