DIVERSIFIED group, Zimplow Holdings Limited, is optimistic about achieving its actual worth on the Victoria Falls Stock Exchange (VFEX), claiming that it is currently undervalued.
The group received consent from its shareholders last Thursday to list on the VFEX after receiving authorisation in May to delist from the country’s primary exchange, the Zimbabwe Stock Exchange (ZSE).
It is expected to be listed on the waterfall bourse on Friday.
“As a result of current currency distortions, we believe that there is no opportune time,”Zimplow chief executive Vimbayi Nyakudya told Standardbusiness on the sidelines of the group’s extraordinary general meeting on Thursday.
“We believe by going on the VFEX, we will rewrite our story.”
Nyakudya said the group wanted to leverage on the foreign currency dominated VFEX to raise capital.
“Right now, we can't raise money on the ZSE,” he said.
“As a business, we are not going to build ourselves on the arbitrages, but we are building ourselves anchoring on the sectors that drive the economy which are agriculture, mining, infrastructure development and transportation.
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“In terms of how we look at the capital, people look at PE [price-to-earnings] ratio, the dividend yield, NAV [net asset value] vs market capitalisation.”
For instance, Nyakudya said the group’s market capitalisation was hovering around US$11 million at the moment and NAV stood at US$30 million.
Nyakudya said the perception, which was being used to look at the capability of a company to generate earnings should be equal to how each and every counter is looked at.
He said the group was upbeat that migration to the VFEX was the best option in line with its long-term plans of becoming the top supplier of agriculture and mining equipment as well as other support services to both the domestic and regional market.
Nyakudya recently told Standardbusiness that the firm will invest more than US$4,6 million in its expansion drive by the end of this year, as it angles for a broader growth initiative.
To lessen the effects on business caused by the closure of the Caterpillar dealership for its unit, Barzem, the group is driving capacity development projects across all of its operating units.
The opening of new business units, Valmec and Tractive Power Solutions (TPS), as well as enhanced resource allocation to Scanlink and Trentyre units to improve performance and overall contribution to the group, are some of the major efforts.
