July proved to be an eventful month for our local capital markets. On July 9, Zimbabwe Stock Exchange (ZSE) Holdings listed on its own main board, with trading commencing on July 11th.
OK Zimbabwe shareholders approved the company’s capital raise plan during an extraordinary general meeting held on July 17, paving way for the renounceable rights offer, which opened on July 21 and closed on August 4th.
The ZSE posted its second highest monthly surge in market capitalisation for 2025, though its July-end market cap remains in line with levels seen at the end of 2024, an undervaluation we highlighted at the start of the year.
Meanwhile, the Victoria Falls Stock Exchange (VFEX) reached its highest market capitalisation since inception in 2020. While there were no new listings in July, UK-based mining company Kavango Resources Plc is scheduled to debut on VFEX on August 29, as part of its plan to raise US$13,5 million to fund exploration activities. The firm is already listed on the London Stock Exchange.
Let’s now take a closer look at both markets in detail.
The ZSE gained 5% in July, building on a 2% rise in June and a 3% increase in May. This marked the second largest monthly advance of the year, trailing only the 6% rally seen in February.
Despite this momentum, the current market capitalisation of US$1,6 billion remains on par with levels recorded at the end of 2024, when the ZSE closed in negative territory because of tight liquidity measures.
Monthly turnover increased to ZiG 771 million, up from ZiG 532 million recorded in June. Econet led trading activity with ZiG274 million, followed by FBC at ZiG 125 million. This contrasts with June’s rankings, where Delta and Econet topped the charts with ZiG 212 million and ZiG 116 million, respectively.
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Market breadth remained largely positive in July. The ZSE closed the month with 18 gainers against 13 losers. Seed Co led the rally, surging by 58%, while TSL, Tanganda, First Mutual Properties, and Econet also posted strong gains of 23%, 21%, 19%, and 18%, respectively.
On the downside, OK Zimbabwe topped the losers’ list, shedding 30% of its value after a 3% decline in June. DZLH and Unifreight also recorded steep losses, falling 27% and 22%, respectively. OK Zimbabwe’s continued slide was likely driven by mixed investor sentiment following its detailed funding plan to raise US$20 million through a rights offer and US$10 million via asset disposals.
Post-approval of the capital raise plan, the renounceable rights offer opened on the 21st of July and closed on the 4th of August. Notably, on August 1, trading in OK Zimbabwe’s Letters of Allocation took place during its rights offer period worth circa US$100 000.
Delta Corporation posted a modest gain of just 0,36% in July, likely weighed down by ongoing disputes with Zimra, which is pursuing an additional US$73 million in tax assessments against the beverages giant.
Additionally, subdued Q1 performance from its sparkling beverages unit with Schweppes, compounded by competition from the informal market and the impact of the sugar tax, further limited its upward momentum.
Liquidity on the ZSE improved in July, with overall market activity picking up. Several counters began to reprice during the month, addressing the widening disconnect between share prices and underlying fundamentals, which helped most blue chip stocks finish in positive territory.
Econet and Delta accounted for 80% of the ZSE’s July turnover, while Simbisa dominated VFEX, contributing 91% of its monthly turnover. This may have been further driven by the release of Q1 results from these heavyweights.
The VFEX closed July on a positive note, with market capitalisation rising by 10%, rebounding from the 0,02% dip recorded in June. Six stocks ended the month in the green, while only two posted declines.
However, monthly turnover dropped 41% to US$4,3 million, down from US$7,2 million in June.
Padenga emerged as the top performer, while Edgars posted the steepest decline among the two losers, shedding 14,18% of its value. While on the ZSE, Delta and Econet remain the largest counters by market capitalisation, on the VFEX, Innscor has taken the lead, overtaking WestProp, while Padenga and Simbisa now rank third and fourth, respectively.
Although both exchanges are currently underperforming relative to their potential, and some investors may have become wary of the stock markets due to regulatory risks, I view July’s performance as a positive development and a step in the right direction.
Hopefully, this trend will continue, as many stocks still have significant room to adjust to their true fundamental values.
However, various macroeconomic factors could either support this upward momentum or disrupt it again.
Taimo is an investment analyst with a talent for writing about equities and addressing topical issues in local capital markets. He is an active member of the Investment Professionals of Zimbabwe community, pursuing the Chartered Financial Analyst charter designation
