Stanbic Bank
Stanbic Bank
Stanbic Bank
Stanbic Bank
24.7 C
Kampala
Stanbic Bank
Stanbic Bank
Stanbic Bank
Stanbic Bank

MTN Uganda tops as Uganda’s most valuable brand

Must read

MTN Uganda with market capitalisation of $1 billion is Uganda’s most valuable brand, according to the latest annual survey done by African Business Magazine headquartered in South Africa.

According to the survey, MTN Uganda attained position 102 out of the 250 companies ranked in Africa. This was an improvement when compared to the 105 position the Ugandan telecoms giant attained previously.

Stanbic Bank Uganda with market capitalisation of $285 million came second in Uganda even though it was ranked 224 in Africa, which was a decline given that the Ugandan lender previously came in position 215 when it had capitalisation of $357 million.

East African telecoms giant Safaricom retained the top spot in East Africa despite a decline in its overall ranking. On the continent Safaricom is was ranked 25th with $5.4 billion market capitalisation, from position 12, when it had capital of $11.89 billion.

Tanzania Breweries Ltd, Equity Holdings Group and East African Breweries were ranked 77th, 83rd and 101st position with a market capitalization of $ 1.37 billion, US$ 1.29 billion and $1 billion, respectively.

Other companies in the Top 250 companies are; KCB Group ($861 million), NMB Bank ($748 million), Vodacom Tanzania ($737 million), Tanzania Cigarette Co ($726 million) Co-operative Bank of Kenya ($582 million), Absa Bank Kenya ($525 million), Standard Chartered Bank Kenya ($485 million).

Others are; British American Tobacco Kenya ($350 million), Stanbic Bank Kenya ($328 million), Tanzania Portland Cement ($311million) and I&M Holdings ($260 million) are the other companies that have made it to the list of Top 250 companies in Africa.

The African Business Top 250 Companies survey focuses on the biggest companies, with the ranking determined by the market capitalisation (total value of the listed shares). The market capitalisation is converted into US dollars on the same date.

To be ranked, the company must be listed on the national and regional stock exchanges across Africa and make huge profits and invest in Africa-wide strategies to seize future opportunities.

Market capitalisation declines

Overall, the market capitalisation for the top 250 biggest listed companies declined considerably since the 2022 survey, from $701 billion to $561 billion, and is well below the record$948 billion achieved in 2015.

The 2022 figure represented, however, a strong recovery from the low of $556 billion recorded in 2020 at the height of the #Covid-19 pandemic. Many companies enjoyed a temporary bounce from the release of pent-up demand.

Yet this year’s market capitalisation has drifted below the lows of the pandemic – and much more needs to be done to support the growth of a vibrant private sector across the continent.

According to a recent McKinsey study, of the 438 African companies with revenues in excess of $1 billio, 60% were privately owned and 25% were subsidiaries of foreign-domiciled multinationals.

The continent’s biggest oil firms, such as Sonatrach from Algeria and Sonangol from Angola, would be among the very largest companies if they were listed. The Angolan government has pledged to list Sonangol on the Angola Stock Exchange, but the timetable for this has repeatedly slipped and the current target date is in 2027.

South African companies still dominate

The lion’s share of this year’s decline is due to big drops in the value of South African stocks, from $488 billion to $375 billion over the past year. The position of South African companies within the pan-African corporate landscape is particularly interesting.

Stock values on the Johannesburg Stock Exchange (JSE) have tumbled in dollar terms over the past year through a variety of factors, including the falling value of the rand; the underlying weakness of the South African economy; and the impact of low infrastructural investment on power supplies and transport reliability. This is reflected in our survey, with the number of South African entries in our Top 250 falling from 133 last year to 96 in our 2023 rankings.

However, it is important to note that cyclical fluctuations in demand for mining commodities have also played a role. Commodity prices soared as the #Covid-19 pandemic and associated lockdown measures were lifted, driving up the value of the mining companies that comprise a significant proportion of the JSE. For instance, the value of the highest-ranked mining company in our table, Anglo American Platinum, jumped from $11.3 billion in March 2020 to $38.6 billion in 2021 and then $36.4 billion the following year, before crashing to $14.2 billion this year, with its value mainly determined by wide fluctuations in global demand.

The total value of the Top 250 was also affected by several delistings, notably South Africa’s Massmart and Danone Centrale in Morocco. The lack of medium-term growth in the value of Africa’s biggest corporations is, however, also partly a function of general African economic trends, with the optimism generated by moderately robust growth in the first part of the new millennium giving way to more patchy growth punctuated by a handful of stronger growing economies.

The lack of progress is also reflected in the lack of strength in depth. The 250th position in the rankings was achieved with $394 million in 2018; but that figure fell this year to the $229 million valuation of Cleopatra Hospital in Egypt.

Despite continued weak economic growth in South Africa, the country’s 96 corporations listed in the continent’s Top 250 companies completely dominate it, taking 67% of its entire value, with combined market capitalisation of $375 billion out of the $556 billion total for the Top 250.

Nine of the top ten slots were filled by South African companies, with only telecoms company MTN Nigeria intruding into a perfect ten, while 15 out of the top 20 are South African. Of the remaining five, three are Nigerian and two Moroccan, which fairly reflects the balance of power in the overall table.

Naspers leads the table with market capitalisation of $81 billio, up from $50 billion last year, although still down from a high point of $104 billion in 2021. Naspers also has the highest net income by a long way, with $12 billion, ahead of Anglo-American Platinum with $2.7 billion. However, analysts have suggested that some of the company’s operations may have little room for growth in its domestic market.

Naspers moved to the top of the pan-African rankings in 2016 following the purchase of a 33% stake in Chinese tech and entertainment company Tencent – but now plans to sell off some of its stake to fund a planned share buyback.

Its stake in Tencent was worth about $100bn at the start of the year, but the company’s share price on the JSE lies significantly lower than its net asset value per share, because of its complicated dual system of voting rights, which reduce shareholder influence on the company’s operations.

FirstRand moves up one place to second, despite a big fall in value from $30 billion to $19 billion, with fellow South African bank Standard Bank rising two positions to third with $16 billion, from $21 billion last year, representing a far more modest fall.

Beyond South Africa

South Africa’s continued dominance of the African corporate landscape obviously means that the rest of the continent appears – and indeed is – underrepresented in the rankings. North Africa accounts for 14.3% of the value, followed by West Africa with 11.4% and East Africa 3.3%.

The next biggest markets by combined market capitalisation are Nigeria with 9.3%, Morocco with 8.8% and Egypt with 4.7%. There is not a single entrant from Central Africa, and some individual countries are conspicuous by their absence, including Algeria, Ethiopia and the Democratic Republic of Congo (DRC). State control largely explains the first two, while many of the biggest economic enterprises in the otherwise underdeveloped DRC are foreign mining companies.

The survey shows Mauritius is the next most important country in the Top 250, with six companies and 1.3% of market value, an increase of 2 percentage points. It is followed by Namibia with seven entrants and 1.2%, also up 2 points on last year. The remaining Southern African companies come from Malawi (7), Botswana (3), Zimbabwe (3) and Zambia (2). It might be expected that Zambia would enjoy stronger representation – but its large mining sector is dominated by foreign companies.

- Advertisement -

More articles

2 COMMENTS

LEAVE A REPLY

Please enter your comment!
Please enter your name here

- Advertisement -

Latest article

- Advertisement -