At the midpoint of 2024, the Bourse Régionale des Valeurs Mobilières (BRVM) has shown resilience and growth, solidifying its position as a key player in Africa’s financial landscape. The first half of the year has seen impressive gains across various sectors, with several stocks outperforming expectations and setting new records.

A New Milestone

The BRVM exchange achieved a significant milestone on Wednesday, June 26, 2024, as its overall capitalization reached 19 trillion FCFA ($31 billion). This achievement cements the BRVM’s status as the fifth-largest African stock exchange in terms of market capitalization.

Moreover, it now represents approximately 15.81% of the GDP of the West African Economic and Monetary Union (UEMOA) zone, highlighting its crucial role in financing the region’s economies.

Market Index Performance

The market’s performance is reflected in the positive returns of its various indexes.

As of the end of June 2024, the benchmark BRVM Composite index led the pack with a 7.26% year-to-date return, followed closely by the BRVM Principal at 6.88%. The BRVM Prestige and BRVM 30 indexes also showed strong growth at 6.59% and 6.28% respectively. Sector-specific indexes such as the BRVM Industrial Index and BRVM Agricultural Index posted gains of 6.15% and 5.76%, while the BRVM Distribution index recorded a more modest increase of 1.3%.

Spotlight on Large-Cap Stocks

Among the large-cap stocks, Orange CI and Sonatel have been particularly noteworthy. Orange CI recently reached a new all-time high of 12,000 FCFA per share since its initial public offering in 2022. Meanwhile, Sonatel saw its market capitalization surge from 17 billion FCFA to an impressive 1.95 trillion FCFA ($3.2 billion). The telecom giant’s share price climbed to 19,500 FCFA, its highest level since April 1, 2019, representing a 0.88% gain and accounting for 23% of the overall BRVM market capitalization.

Another standout performer was BICICI, which experienced a 46.6% increase in its share price over the three months leading up to Friday, June 21, 2024. In this report, Daba tracks the top best-performing stocks on the BRVM in the first half of 2024, based on year-to-date share price growth:

  1. Servair Abidjan (ABJC) – Industrial Sector, YTD Return: 50.4%

Servair Abidjan, a leader in airline catering and airport services, has seen its stock soar by an impressive 50.4% year-to-date. The company’s strong performance can be attributed to the recovery in air travel and tourism in the region, as well as its strategic initiatives to diversify its service offerings.

Servair Abidjan began the year with a share price of 1,330 XOF and has since gained 62% (even higher than its June close levels), ranking it first on the BRVM by share price growth. It has a market capitalization of XOF 23.5 billion making it the 33rd most valuable stock.

  1. BICI (BICC) – Financial Sector, YTD Return: 33.6%

BICI, a prominent player in the Ivorian banking sector, has delivered a robust 33.6% return to its shareholders so far this year. The bank’s focus on digital transformation and expansion of its retail banking services has likely contributed to its strong market performance.

BICI is currently the 10th most valuable stock with a market capitalization of XOF 153 billion. The stock began the year with a share price of 7,490 XOF and while it ended June as the second-best performer, profit-taking by investors has seen its share price growth fall to 22.8% with its share price currently at 9,200 XOF.

  1. Unilever CI (UNLC) – Consumer Goods Sector, YTD Return: 30.0%

Unilever CI, the Ivorian subsidiary of the global consumer goods giant, has seen its stock appreciate by 30% in the first half of 2024. The company’s diverse portfolio of household and personal care products, coupled with its strong brand presence in the region, has helped drive this impressive growth.

Unilever is the 29th most valuable stock on the BRVM with a market capitalization of XOF 59.7 billion, gaining 30% since January when the stock began the year with a share price of 5,000 XOF.

  1. ONATEL (ONTBF) – Telecom Sector, YTD Return: 25.0%

ONATEL, Burkina Faso’s leading telecommunications provider, has rewarded its investors with a 25% return year-to-date. The company’s continued expansion of its mobile and internet services, along with increasing digital adoption in the country, has fueled its strong market performance.

The Burkina Bank is the eighth most valuable stock on the BRVM. It has a market capitalization of XOF 194 billion after its share price surged 25% from 2,280 XOF on January 1.

  1. Societe Ivoirienne de Banque (SIBC) – Financial Sector, YTD Return: 21.0%

Rounding out the top five is Societe Ivoirienne de Banque, with a 21% year-to-date return. The bank’s solid performance can be attributed to its strong presence in Côte d’Ivoire’s growing economy and its efforts to enhance its digital banking capabilities.

SIBC is currently the sixth most valuable stock on the BRVM with a market capitalization of XOF 326 billion and began the year with a share price of 5,350 XOF.

Other notable performers on the BRVM include Société Générale (SGBC) and Bank of Africa – Senegal (BOAS), both from the financial sector, with year-to-date returns of 20.9% and 20.3% respectively. These results underscore the strength of the banking and financial services sector in the region, driven by economic growth and increasing financial inclusion.

In the consumer goods sector, SITAB (STBC) has also shown strong performance with a 17.8% year-to-date return. The company, which operates in the tobacco industry, has benefited from steady demand and effective cost-management strategies.

The utilities sector is represented in the top performers by CIE (CIEC), with a 17.4% return. As the primary electricity provider in Côte d’Ivoire, CIE’s performance reflects the country’s growing energy demands and infrastructure development.

Rounding out the top 10 is TotalEnergies Cote d’Ivoire (TTLC) from the oil and gas sector, with a 17.2% return. The company’s performance is indicative of the recovering global energy market and its strong position in the Ivorian market.

The strong performance of these top stocks reflects the overall positive sentiment in the BRVM market and the diverse range of sectors represented among the top performers – from industrials and financials to consumer goods and telecoms – highlights the breadth of investment opportunities available. 

This diversity can offer investors the potential for balanced portfolio growth and risk management. However, investors need to conduct thorough research and consider their risk tolerance before making investment decisions. 

Market Outlook and Opportunities

As we move into the second half of 2024, the BRVM continues to demonstrate its importance as a driver of economic growth in the UEMOA region. The exchange’s recent milestone of reaching 19 trillion FCFA in market capitalization is a testament to its growing significance on the African financial landscape.

The strong performance of the BRVM in the first half points to several key trends and opportunities:

  • Financial Sector Strength: With three of the top five performers coming from the Financials sector, it is clear that banking and financial services continue to be a driving force in the WAEMU (UEMOA) economy.
  • Consumer Goods Resilience: The presence of Unilever CI in the top performers list suggests ongoing strength in consumer spending, which could present opportunities in related sectors.
  • Infrastructure and Telecommunications: The performance of ONATEL highlights the continued importance of telecommunications infrastructure in driving economic growth.
  • Industrial and Service Sector Growth: Servair Abidjan’s top performance indicates potential in sectors tied to travel and hospitality, which could signal broader economic recovery and growth.

The first half of 2024 has been a period of impressive growth for many stocks on the BRVM. From the stellar performance of Servair Abidjan to the solid returns of TotalEnergies Cote d’Ivoire, investors have had numerous opportunities for portfolio appreciation.

However, as with any investment, it is crucial to remain vigilant and informed. Market conditions can change rapidly, and past performance does not guarantee future results. As the BRVM continues to evolve and mature, it presents an exciting frontier for both regional and international investors.

This article was contributed by Michael Ajifowoke, Insights Associate at Daba Finance.

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