Stock brokers are optimistic about the Dar es Salaam Stock Exchange's (DSE) performance in 2024, attributing it to the robust potential of listed companies' earnings. Analysts point to a favorable economic landscape, with the International Monetary Fund (IMF) projecting a real GDP growth of 5.2% and consumer prices at 4.0% for the year.
Isaac Lubeja, Advisory and Research Manager at Zan Securities, highlighted the banking and finance sectors as the favorites for 2024, citing a significant 34% surge in the Banks, Finance & Investment index (BI) last year. Lubeja expressed confidence in the impressive third-quarter profits reported by leading companies, predicting similarly strong full-year results that could lead to upward revisions in stock target prices.
Furthermore, experts anticipate growth in sectors beyond banking and finance, such as manufacturing, especially in cement stocks and telecommunications. Ammi Julian, Investment Analyst at Orbit Securities, anticipates a robust year for stock investors, basing his forecast on the approaching financial year-end for entities like NMB Bank, CRDB Bank, Swissport, Twiga Cement, NICOL, and TICL.
Julian identified Vodacom as a dark horse with a surge in pre-tax profit, suggesting potential dividend payouts. However, Imani Muhingo, Head of Research and Analytics at Alpha Capital, cautioned about relaxed growth in the banking sector due to a less accommodative policy by the central bank.
Muhingo also predicted increased foreign investors' participation in 2024, supported by US Fed rate cuts and expansionary policies in developed economies. Exodus Advisory CEO Ramadhan Kagwandi highlighted the possibility of reversing the foreign investor departure trend from the previous year if economic conditions continue to improve. Kagwandi emphasized the country's B+ rating by Fitch, indicating a favorable creditworthiness level.
In the fixed-income sector, brokers expect tight liquidity conditions to persist, driving higher yields. The recently issued 25-year bond recorded a cut-off yield of 15.4%, and analysts anticipate long-term yields to hover around the 15% mark in the first quarter of 2024. Key sectors to watch this year, according to experts, include banking stocks, cement stocks, closed-end funds, and the self-listed DSE.