Tanzania’s stock market is set to connect electronically to the stock exchanges of Uganda and Rwanda by the end of 2020.
The Dar es Salaam Stock Exchange (DSE) was incorporated in 1996 as a private company limited by guarantee (a non-profit making body) and became operational in 1998.
As of September 2020, there are 27 listed equity securities, 13 licensed brokers, and 6 custodian banks, with a market capitalization of TZS 15,183.09 billion (USD 6.5 billion).
Dar es Salaam Stock Exchange History
The first company to list at DSE was Tanzania Oxygen Limited (DSE:TOL) in 1998, which was also the first state-owned company selected for privatization through the capital markets.
It was followed by Tanzania Breweries Limited (DSE:TBL), Tanzania Cigarette Company (DSE:TCC), Swissport (DSE:SWIS), Tanzania Portland Cement Company (DSE:TPCC), Tanga Cement Company Limited (DSE:TCCL) and National Microfinance Bank (NMB).
After these first state-driven listings, other private companies decided to list at DSE as a part of their corporate growth strategy to raise capital.
These include TATEPA, CRDB Bank, DCB Commercial Bank, and Precision Air that listed at the DSE during 1999–2011.
In 2013, the DSE launched a second-tier market, the Enterprise Growth Market (EGM) with lower listing requirements. The EGM is designed to attract small and medium companies with high growth potential.
So far, the EGM has attracted five companies, including YETU Microfinance Bank, Mkombozi Commercial Bank, Maendeleo Commercial Bank, Mwalimu Commercial Bank, and Swala Oil & Gas.
In 2015, the DSE was demutualized, i.e. it changed its registration status from being limited by guarantee to being limited by shares.
Moremi Marwa, CEO of DSE, explained that the bourse aims at maximizing the value of investment through the process of demutualization.
The DSE is the third Exchange in Africa to demutualize after the Johannesburg Stock Exchange (JSE) and the Nairobi Securities Exchange (NSE).
In May 2016, the DSE launched its own IPO of 15 million ordinary shares at TZS 500 per share.
The Tanzanian bourse raised TZS 35.8 billion from more than 3,000 investors, which is equivalent to 377% in excess of the targeted capital.
Following the oversubscribed IPO, the bourse exercised the greenshoe option of 35% to take up an additional TZS 2.6 billion. After exercising the option, the total capital raised from the DSE IPO is TZS 10.1 billion.
In July 2016, following the successful DSE IPO, the Tanzanian bourse listed itself at the secondary market under the ticker “DSE”.
Dar es Salaam Stock Exchange Performances
As of September 2020, the DSE market capitalization stood at TZS 15,183.09 billion (USD 6.5 billion), compared to TZS 17,906 billion (USD 7.7 billion) at the end of 2019, representing a decrease of 18%.
The DSE All Share Index (DSEI), which comprises all listed companies at DSE, reached TZS 1,828.80 on 9th of September 2020, down 14% from its peak for the year at above TZS 2,000 in February of the same year.
At the end of Q1 2020, the total amount of outstanding corporate bonds was TZS 176 billion (USD 76 million) issued by four entities: Trade and Development Bank (TDB), EXIM Bank, National Microfinance Bank (NMB), and Tanzania Mortgage Refinance Company (TMRC).
As of 31st March 2020, total outstanding government bonds stood at TZS 10,864 billion (USD 4.7 billion), marking a 3% increase from the TZS 10,531 billion (USD 4.5 billion) on 31st December 2020.
In 2019, the DSE recorded a profit before tax of TZS 3.7 billion, compared to TZS 1.8 billion in 2018, marking an increase of 106%. The increased profitability is on account of good performance in equity trading and bond trading activities, the DSE explains.
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The Dar es Salaam Stock Exchange (DSE) closed on Friday, February 24th, 2017 with a total market capitalization of TZS20,079.40, compared to TZS19,952.80 on Friday, February 17th, 2017 (+0.63%).
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