Weekly Investor Update (July-WeekFour-2024)
16 min Read July 26, 2024 at 5:00 PM UTC
![Daba finance invest in Africa](https://daba-wp-bucket.s3-accelerate.amazonaws.com/wp-files/featured-image-6073bd96-97b8-438d-a8ec-55ea0b075d6e.png)
Monday
Egyptian fintech unicorn MNT-Halan gets $157.5m for global expansion
Months after announcing a $400 million funding injection to become Egypt’s first unicorn, fintech startup MNT-Halan has secured an additional $157.5 million in a recent funding round to expand its operations beyond Egypt.This funding round was led by the International Finance Corporation (IFC), which provided $40 million and included participation from existing investors such asDevelopment Partners InternationalandLorax Capital Partners, along with funds managed byApis Partners LLP,Lunate, andGB Corp.Founded in 2018 by Mountie Nakhla, MNT-Halan digitizes banking services and replaces traditional cash transactions with electronic payment solutions. The company offers a range of services, including payments, lending, consumer finance, and e-commerce. This new development brings the startup’s total funding to$677.5 millionover the past two years, supporting its expansion efforts.
MNT-Halan claims to have served over 5 million clients through its tech and data-driven solutions and disbursed over $2.5 billion in loans. Also, its e-commerce platform processes more than $50 million in monthly sales. In March 2024, MNT-Halan acquired Advans Pakistan microfinance bank, a subsidiary of the international microfinance Group Advans, which operates in Africa and Asia. This acquisition marked MNT-Halan’s first expansion outside of Egypt, providing immediate scale with over 62,000 clients and 19 branches. In June 2022, MNT-Halan announced the acquisition of Talabeyah, a B2B eCommerce platform that offers FMCG supplies directly to small merchants and retailers, and soon to consumers, fulfilling all their requirements with next-day delivery.
BRVM posts best weekly gain since 2021 on telecom stocks rally
The BRVM benchmark Composite index posted its best weekly performance since July 2021 last week, rising 3.25% to close at 239.18 points, also its highest level in six years.That came from a rally in bellwether stocksOrange CI(+8.33% to 13,000 FCFA) andSonatel(+4.09% to 20,505 FCFA), the twomost valued companies on the regional exchange. Both saw theirmarket capitalizationsurge to 1.95 trillion FCFA and 2.05 trillion FCFA respectively.Meanwhile, the BRVM 30 (+3.59% to 119.87 points) and BRVM Prestige (+2.29% to 112.15 points) indices achieved their third consecutive increases, hitting record levels.
On Thursday, Sonatel reclaimed its position as the most valuable stock on the BRVM with a market capitalization exceeding 2 trillion FCFA, accounting for approximately 22.8% of the entire exchange equity market. Its share price reached 20,200 FCFA, its highest level in six years. The day before, Sonatel had briefly lost its top spot to Orange CI (ORAC) after the Ivorian telecom company added 141 billion FCFA to its market cap, reaching 2.02 trillion FCFA (around $3.4 billion) as of Wednesday’s market close. In total, the stock market saw an additional capitalization of 279.74 billion FCFA, driven by the rise in 19 stocks, which collectively added 309.03 billion FCFA, against 18 declining stocks, which lost 29.29 billion FCFA.
Societe Ivoirienne de Banque to pay $45.6m in dividends
Societe Ivoirienne de Banque (SIBC), the Ivorian subsidiary of theAttijariwafagroup, is paying dividends scheduled for July 31, 2024. Shareholders can look forward to receiving a total of 27.41 billion FCFA ($45.6 million), which represents a distribution rate of 63%.Despite an increase in the net cost of risk and overheads, the bank achieved a net profit of 43.51 billion FCFA in 2023 compared to 40.1 billion FCFA a year earlier, marking a 9% increase. This profit underscores the solidity and resilience of SIB in navigating the competitive banking sector.In addition, the bank’s net banking income saw a 14% rise, reaching 95.6 billion FCFA compared to 83.5 billion FCFA the previous year, thanks to improved net interest margins and market activity. These financial results highlight a successful 2023 for SIB, with all indicators in the green and a positive outlook for its shareholders.
SIBC is currently the fifth most valuable stock on the BRVM, with a market capitalization of 340 billion FCFA, representing about 3.84% of the equity market. SIBC closed its last trading day (Thursday, July 18, 2024) at 6,790 XOF per share on the exchange, marking a 1% gain over its previous closing price of 6,720 XOF. Starting the year with a share price of 5,350 XOF, Societe Ivoirienne de Banque has seen a 26.9% increase in its share price valuation, placing it eighth on the BRVM in terms of year-to-date performance. Additionally, the stock has gained 5% over the past four-week period.
Tuesday
Zambia expects copper output to hit 1m tons by 2027
Zambia’s annual copper production is projected to grow by more than 40% to reach 1 million tons in 2027, according to the country’s Finance Ministry, and is expected to more than quadruple to 3 million tons by 2031.As Africa’s second-largestcopperproducer, Zambia aims to capitalize on the anticipated supply shortfall due to rising demand for copper driven by the energy transition, which includes increased use in electric vehicles and wind farms.The southern African nation, which derives about 70% of itsexport earnings from copper, plans to enhance the percentage of its landmass mapped for mineral resources. This will be achieved through integrated geophysical, geological, and satellite imagery surveys.
Zambia’s copper output reached a 14-year low of 698,566 tons in 2023 due to frequent tax changes and ongoing conflicts with the previous government. However, according to the medium-term budget plan published by the Ministry of Finance and National Planning on Sunday, production is expected to increase annually from 2025 to 2027. This anticipated growth relies on resolving challenges at some of the country’s major mines, developing green-field projects, and expanding existing facilities.
New Africa-focused credit rating agency set to launch in 2025
A new credit rating agency designed to address the needs of African sovereign borrowers is expected to be operational by next year, Albert Muchanga, the African Union (AU) Commissioner for Development, Trade, Tourism, Industry, and Minerals, said recently.The agency aims to provide a “more tailored” approach tocredit ratingsfor African nations, which have traditionally faced challenges related to high borrowing costs and inadequate representation in global rating systems.Muchanga explained that this initiative is driven by a desire for a fairer evaluation and to improve the financial conditions under which African countries operate. It will be an independent entity, not owned by theAUor any other regional bloc.
The idea for an African credit rating agency was first implemented in 2017, following numerous complaints by African governments regarding the conduct of the “big three” international ratings agencies — Moody’s, Fitch, and S&P in particular. And rightly so, research shows subjectivity and bias in African credit ratings cost countries up to $24 billion in interest and over $46 billion in foregone lending. But according to analysts, an African credit ratings agency may help to tackle lender biases but will not be the only solution to reducing borrowing costs.
Nigerian regulator slaps Meta with $220m fine over data abuse claims
The Federal Competition and Consumer Protection Commission (FCCPC) has fined Meta, the parent company of Facebook, WhatsApp, and Instagram, a substantial $220 million (over ₦300 billion), accusing the company of misusing Nigerian users’ data.This follows a three-year investigation conducted by theFCCPCand the Nigeria Data Protection Commission (NDPC) from May 2021 to December 2023. The commissions allege that Meta violated multiple laws, including the FCCPC Act 2018 and the Nigeria Data Protection Regulation 2019 (NDPR).Meta has expressed its disagreement with the allegations and the fine and plans to appeal the decision. Throughout the investigation, the company reportedly cooperated with authorities, and the FCCPC acknowledged that Meta engaged with investigators as recently as April 2024.
This is not the first instance of Meta being fined or accused of sharing users’ data. In May 2024, court documents revealed that Meta had given Netflix access to Facebook users’ direct messages, enabling Netflix to tailor its ads more effectively using the data.On a positive note, content creators in Nigeria can now earn money from ad revenue on Meta platforms, including Instagram and Facebook, providing new monetization opportunities.
Wednesday
Nigeria hikes interest rate again to curb inflation, steady naira
The Central Bank of Nigeria has raised its key interest rate for the 12th consecutive time, continuing its efforts to control inflation. The monetary policy committee increased the benchmark rate by 50 basis points to 26.75%, as announced by Governor Olayemi Cardoso during a press briefing in Abuja.Additionally, thecentral bankwidened its “asymmetric corridor,” setting the cost for lenders to borrow at 500 basis points above the policy rate, while the return on their deposits was set at 100 basis points below the benchmark rate.Since the tightening cycle began in May 2022, the central bank hasincreased borrowing costsby 1,525 basis points toaddress rising inflation, which accelerated for the 18th consecutive month to reach 34.2% in June.
Inflation in Nigeria has been driven by the government’s partial removal of fuel subsidies and a 70% depreciation in the naira since June 2023, following currency reforms that loosened its de facto peg against the dollar.Despite these challenges, six of Nigeria’s Eurobonds were among the top 20 performers in a Bloomberg index of emerging and frontier-market sovereign debt. The price for securities due in February 2038 rose by 0.6 cents to 80 cents on the dollar, while the prices for notes due in 2051, 2047, and 2033 also gained.
One Acre Fund raises $1.4m with plans to support farmers in Africa
Kenya-basedOne Acre Fundhas recently secured a $1.4 million debt fund from Impact Bridge Asset Management.The Spanish fund manager specializes in social impact investing, financing social and environmental impact companies in underdeveloped countries through its IB Impact Direct Debt fund.Launched in 2006, One Acre Fund has been training farmers in sustainable farming practices, such as micro-dosing fertilizers, providing advice on planting techniques, soil and crop health, and offering services like credit and crop insurance to protect farmers against drought and flood due to climate change.
The social enterprise One Acre Fund aims to serve 10 million farmers by 2030, targeting 10% of the families worldwide living on less than $1 per person per day. Currently, it serves over 1 million farmers across nine African countries: Kenya, Uganda, Tanzania, Rwanda, Burundi, Ethiopia, Malawi, Nigeria, and Zambia. The IB Impact Direct Debt fund, which recently invested in One Acre Fund, has secured $16.3 million from various international investors, including pension funds and foundations. Around 80% of the fund is designated for investments in developing countries, with a particular focus on sub-Saharan Africa and Latin America.
Ether ETFs post $107m net inflows, $1.7bn volume on first day
Ethereum exchange-traded funds (ETFs) saw net inflows of $106.6 million and a trading volume of $1.3 billion on theirfirst day of trading, despite significant outflows from Grayscale’s newly-converted Ethereum Trust.BlackRock’s iSharesEthereum Trust ETF (ETHA) led with $266.5 million in inflows, followed closely by theBitwiseEthereum ETF (ETHW) with $204 million in net inflows. TheFidelityEthereum Fund ETF (FETH) ranked third with $71.3 million.These substantial inflows into the new spot Ether ETFs surpassed the outflows from theGrayscaleEthereum Trust (ETHE), which saw $484.9 million in outflows on the same day, amounting to 5% of the previously $9 billion fund.
Ethereum is around one-third the size of Bitcoin and the debut of its spot ETFs was slightly less than proportional by size. However, Ether outperformed Bitcoin in terms of the absolute value of its net flows on the day of its ETF debut. Ether posted a positive net flow, compared to Bitcoin’s significantly negative -$1.5 billion. More so, the first-day trading volume of BlackRock’s spot Ether ETF was about one-quarter of the first-day trading volume of BlackRock’s spot Bitcoin ETF. Combined, the trading volume for all nine spot Ether ETFs was slightly under one-quarter of the volume of all spot Bitcoin ETFs on their debut day.
Thursday
South African fintech Peach Payments acquires software maker Operativa
South African digital payments provider,Peach Payments, has acquired the customer software development firm Operativa. This marks its first acquisition since closing a$31 million fundinground led by the Apis Growth Fund II last year.Founded in Cape Town in 2012, Peach Payments offers a comprehensive toolkit to help businesses accept, manage, and disburse payments through web and mobile platforms. It reportedly is the second-largest online payment gateway in South Africa and has expanded to Kenya and Mauritius.Since 2022, Operativa has collaborated with Peach Payments, building and maintaining various payment systems and solutions facilitating the fintech’s rapid expansion. The acquisition will integrate the full Operativa team into Peach Payments.
The informal business sector in Africa offers a lot of promise for startups looking to digitize B2B payment flows. The cash-dominated space is rife with late payments and stunts the growth of commerce. Most merchants operate offline in an estimated $800 billion informal trade economy comprising more than 56 million micro, small, and medium-sized businesses. And a survey covering 3,500 companies across 6 countries found that 23% of small businesses experience delayed payments. This explains why merchant acquisition by fintechs like Peach Payments is proving to be Africa’s “new” scramble for payment services.
Cocoa futures jump on Ghana’s plan to restrict some supplies
Cocoa futures surged as Ghana’s plan to limit some supplies for the next season stoked fresh concerns about ongoing shortages.Ghana, the world’s second-largest cocoa producer, has informed buyers that it will decide how much of the next crop can be sold as specialty cocoa based on total production. The regulator will also allocate beans “equitably” among buyers, per a Bloomberg report last week.On Monday, the most active cocoa futures contract rose by as much as 6.4% in New York, marking the biggest intra-day increase in over a week
The move to restrict some purchases indicates concerns that Ghana’s next cocoa crop may not recover as significantly as some expect, even with favorable weather and timely supplies of pesticides and fertilizers. While a good balance of sun and rain in West Africa benefits crop development, cocoa markets are expected to remain volatile until clearer signs of recovery occur. Although prices haveeasedfromrecord highs, due to expectations of better supplies next season, they remain up roughly 90% this year following poor harvests in West Africa.
Starlink mulls Liberia launch after Musk meeting with President
Liberian President Joseph Nyuma Boakai, Sr. recently held a virtual meeting with Elon Musk, CEO of Starlink, to discuss the potential launch of the satellite Internet service provider in Liberia.President Boakai extended an invitation to Musk and his team to visit the West African nation, emphasizing his administration’s commitment to continued engagement and collaboration.During the meeting, Musk highlighted the significance of Starlink, which isalready operational in more than 10 African countries. He emphasized its potential to support initiatives in education, healthcare, rural communities, and other essential sectors in Liberia.
Liberia’s internet penetration is low, with only about 30% of its 5.3 million people having access to the internet at the start of the year. The average internet speed is also below the benchmark, with median fixed connection speeds around 7.14 MB/s as of early 2024. Additionally, the costs are high, with monthly fees for basic broadband averaging $2.63. In 2023, the lowest data price in the country was $1.67 per 1GB for 30 days, while the most expensive plan was $14.5, according to Statista data. The global average data price is $3.12. The telecom sector is dominated by Lonestar Cell MTN and Orange Liberia, which have struggled to expand their services to rural areas due to infrastructural and financial constraints. Despite efforts to improve connectivity, a significant digital divide remains, hampering socio-economic development.
Friday
Kenyan shilling sees longest slide since January on protests
Anti-governmentproteststhat have disrupted Kenya’s economy for the past month and spooked investors are impacting its currency, the shilling, which has experienced its longest decline since January.The shilling weakened for nine consecutive days, reaching 130.68 per dollar by the close of Friday trading in Nairobi, reducing its year-to-date gains to 17%. On Monday, it was up by less than 0.1% in early trading.Despite remaining Africa’s best-performing currency this year, last week’s drop was the largest since April.
Protests erupted in Kenya in mid-June, urging the government to halt tax increases and address corruption. At least 53 people have died, and more than 400 have been injured. Although President William Ruto has rescinded the proposed measures and dismissed almost his entire cabinet, the demonstrations have continued, with calls for him to step down. High import costs and stubborn inflation have contributed to weakening the shilling, but the protests have clearly unsettled investors, analysts say.
South Africa inflation slows to six-month low on food, transport costs
South African inflation slowed in June, according to data released by Statistics South Africa this week, potentially paving the way for the central bank to cut rates at its next meeting.Headline consumer inflation stood at 5.1% year-on-year in June, down from 5.2% in May.Statistics South Africadata showed that inflation has remained above 5% for 10 consecutive months, while the South African Reserve Bank (SARB) prefers it to be at the midpoint of its 3%-6% target band.Due to the slow rate of disinflation, the central bank has kept its main lending rate unchanged at 8.25% for more than a year.
A major concern for the South African Reserve Bank (SARB) has been high food and services prices, but June data indicates these have both decreased to 4.6% from 4.7% in May, nearing the midpoint of the target range. Analysts suggest that lower food and services inflation supports the potential for the central bank to begin cutting rates in September, with a 25 basis point cut being seen as acceptable. Core inflation, which excludes food and fuel prices, was 4.5% in June, according to Statistics South Africa.
Village Capital invests $850,000 in Nigeria, Kenyan agritech startups
Village Capital, a global nonprofit organization focused on early-stage investment, has backed two African agritech startups,Aquarech(Kenya) andCoAmana(Nigeria).Aquarech will receive $350,000, and CoAmana will receive $500,000 as part of Village Capital’s Reducing Inequalities Investment Facility, supported by FMO’sMASSIF Fund. To date, this fund has invested $1.6 million across four startups.“Village Capital is thrilled to invest in CoAmana to catalyze its efforts in building the digital infrastructure for agricultural trade markets across Africa. This investment will drive greater price transparency, efficiency, market linkages, and access to finance,” shared Kavon Badie, Investment Officer at Village Capital.
Many new agritech startups have sprung up across Africa, and are finding business opportunities in addressing the lack of infrastructure and other farming challenges. Africa is fast becoming a global leader in the agritech space, with the continent boasting the highest number of agritech services in the developing world, reaching over 30 million smallholder farmers, as of 2021. The startups are even more relevant considering agriculture contributes greatly to Nigeria and Kenya’s GDP and employs more than 50% of their population.
This material has been presented for informational and educational purposes only. The views expressed in the articles above are generalized and may not be appropriate for all investors. The information contained in this article should not be construed as, and may not be used in connection with, an offer to sell, or a solicitation of an offer to buy or hold, an interest in any security or investment product. There is no guarantee that past performance will recur or result in a positive outcome. Carefully consider your financial situation, including investment objective, time horizon, risk tolerance, and fees prior to making any investment decisions. No level of diversification or asset allocation can ensure profits or guarantee against losses. Articles do not reflect the views of DABA ADVISORS LLC and do not provide investment advice to Daba’s clients. Daba is not engaged in rendering tax, legal or accounting advice. Please consult a qualified professional for this type of service.
Our weekly newsletters offer major news updates and insights on the African economy and markets
Next Frontier
![](/images/home/man.jpg)
![](/images/home/avatar2.jpg)
![](/images/home/avatar1.jpg)