3 December 2012

Uganda: Umeme Trades Shares On Use

Photo: Rachel Mabala/Monitor

Kampala — Investors have another opportunity to own Umeme shares after the power distributor listed on the Uganda Securities Exchange (USE) last week.

According to experts, the listing of its shares to the public will help to enrich the variety of the products on the market.

UMEME becomes the 15th player on the bourse and adding at least $200m in market capitalization.

The power distributor released its share allocation results on Wednesday last week that showed that almost every pool of subscribers, apart from the East African Qualified Institutional investors and the international investors, received the full amount of shares they had applied for.

Speaking during the bell ringing ceremony in Kampala last week, Mr. Joseph Kitamirike, the CEO of the USE said that Umeme's listing would move the market capitalization at the bourse from Ush13trillion to Ush14trillion ($5.4b) and also diversify the stocks on the exchange.

Kitamirike also hinted at the commencement of electronic trading without being specific on the exact date.

Mr. Patrick Bitature, the Chairperson of the Board of Directors of Umeme said, "Our commitment will not be distracted. We have outperformed our targets and our outlook of the energy sector is positive."

Trading of Umeme shares hit a high of Ush295 per share at the bourse but dropped to Ush270 per share closing its first day with an average of Ush275 per share.

An earlier note released by Crested Securities and Stocks a brokerage firm stated that the Ush275 per share was low and that Umeme's value would touch Ush323 per share.

"We make a BUY recommendation for Umeme based on a fair value of UGX 323," read the note.

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