Tanzania: Foreign investors snap up Tanzania Breweries shares

Foreign investors snapped up Tanzania Breweries Limited (TBL) shares last week to send the weekly turnover at the Dar es Salaam Stock Exchange (DSE) to a record performance over five years, AllAfrica reported on November 13.

The beer maker transacted a total of 6,292,603 shares to contribute a cool Sh84.95 billion, almost equivalent to last week's Sh85.8 billion turnover.

The Sh85.8 billion-turnover was a rise from only Sh2.99 billion that was registered during the week ending November 3, 2017.

Last week's trading activities started slowly, with the maker of Kilimanjaro Premium Lager and Safari Lager transacting only 223 shares at a weighted average price of Sh13,200/share.

The situation was not very different on November 7 and on November 8 when the beer maker transacted only 2,153 and 200 shares respectively. However, the trend changed abruptly on November 9 when TBL moved a total of 5,898,570 shares on pre-arranged basis and some 9,066 more on normal basis at a weighted average price of Sh13,500/share to contribute a staggering Sh79.753 billion to the day's turnover.

Though stock market experts and authorities appeared coy to state who bought and sold the shares on November 9, The Citizen understands that they were sold in South Africa by employees' trust for SABMiller.

Apparently, it was SABMiller that bought the shares.

"I am not sure who bought and sold the shares but what I do know is that I can't remember when such a huge transaction took place at the DSE," said the Zan Securities chief executive officer, Mr Raphael Masumbuko.

His Core Securities counterpart, Mr George Fumbuka shared similar sentiments. "It is a massive transaction and one that shows that some investors somewhere are offloading the shares they used to hold so they can use the money for other economic undertakings," he said.

The massive sale of TBL shares in South Africa happened just one day before the company held its Annual General Meeting (AGM) in Dar es Salaam where the firm's chairman, Mr Cleopa Msuya informed shareholders that its total revenue dropped by six per cent to Sh1.041 trillion during the year ending March 2017 compared to a similar period in the preceding year.

"Revenue declined much lower that sales volume owing to exceptional costs incurred as a result of the transition of SABMiller to AB InBev," he said.

The company, said Mr Msuya, faced what he termed as some 'unique' challenges and opportunities during the year ending March 2017 that tested its abilities to adapt and succeed in the market.

"We were confronted with numerous economic and industry challenges, most notably severe drought that impacted harvest and supply of raw materials, a five (5) per cent increase on excise duty hence forcing the industry to increase price on alcohol products, and government ban on plastic bags which impacted production and sale of spirit sachets. As a result overall Group performance was affected negatively," he said.

All the challenges notwithstanding, stock market experts are of the view that TBL remains the most profitable manufacturing house in Tanzania and investors maintain a bullish outlook that they will keep yielding dividends going forward.

This is the second time in less than two months that TBL is recording massive share sales.

During the week ending September 22, 2017, the Dar es Salaam-headquartered brewer transacted a total of 3.95 million shares to contribute a total of Sh53 billion to that week's performance.

TBL Group is a subsidiary of the Belgium-based Anheuser-Busch InBev (AB InBev). AB InBev acquired South Africa-based SABMiller towards the end of 2015 at deal that was valued at $107 billion.

14 November, 2017