An old friend who is part of the team responsible to mobilise domestic (Rwandan) investors to buy Bralirwa shares during its Initial Pubic Offering (IPO) told me that he was fascinated by the enthusiasm by the local public to understand the operations of the stock market and particularly the details of this IPOI.
The 128,570,000 Bralirwa shares government is selling through the Initial Public Offering (IPO) would see many Rwandans saving and investing their money for a brighter future.
The shares are now selling at Rwf136 per share but analysts predict the price is likely to rise once the shares are officially listed on the Rwanda Over-The-Counter (ROTC) bourse on January 31, 2011. This would mean a capital gain in a period of just one moth. The ultimate objective for an inventor here is to own stokes that will generate wealth for you.
The minimum subscription is 100 shares worth Rwf13, 600. Basing on the analyst forecasts, it’s worthwhile to invest your money in Bralirwa. Bralirwa recorded an average growth rate of almost 56 percent of net profit between 2007 and 2009.
Of course some people passionately like the company and they might buy shares not in the name of saving but to be able to have a sense of ownership in it because really this is Rwanda’s largest and oldest brewery and most people are proud of it. But I strongly believe that the main reason people buy shares is to make money.
If it is oversubscribed, the listing will prove that the poor are very much bankable and reliable with potential to offer growth opportunity especially in rural areas.
The government is keen to ensure more equitable growth to help poor people, especially in rural areas to improve their living standards and encourage them to develop the savings culture.
Government is strongly willing to support long term savings and also widen and deepen the financial sector would see improved liquidity in the economy.
Once our stock market is fully operational, it will give a big boost to economic development through the creation of liquidity because many profitable investments require a long-term commitment of capital.
But its success and the success of future IPO’s in Rwanda hinge on a strong education and awareness campaign because this is a new excise in the country.
The central bank Vice Governor, Ambassador Clever Gatete said that: “Rwandans especially ordinary people should be encouraged to buy shares particularly in the recently launched Bralirwa IPO, the more profits made by the company the richer one becomes.”
The development of a vibrant capital market will help solve the private sector’s challenges of rising long-term capital to finance businesses.