Durban - African Phoenix Investments Limited (Apil), an investment holding company resurrected from the remnants of the failed African Bank Investments Limited (Abil), on Wednesday listed on the JSE to begin trading with an estimated 1.4 billion ordinary shares in issue and 13.5 million preference shares.
Nesan Nair, a stockbroker and portfolio manager at Sasfin Securities, said, by 2pm, more than 41 million shares had already exchanged hands.
Nair said he did not expect a huge demand for the stock currently as not many people would be wiling to invest at the moment.
“It is only cash at the moment,” Nair said. “Remember that the new ‘African Bank’ has been moved out of African Phoenix and is a completely new entity (owned by the Reserve Bank, the Public Investment Corporation and the rest of the banks).
“Unless African Phoenix does a deal soon, you are basically invested in cash.”
Nair said investment interest would largely be “centred around people who ‘short-sold’ the shares and need to buy them back in order to deliver.
“I remember that more than 30 percent of the stock was short sold, so the need to buy back and deliver will create a fair amount of trade volume in the share,” he said.
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Rahima Cassim, fund manager at Ashburton Investments, said it was important for potential investors to distinguish between the old African Bank and Apil.
“This is not the old African Bank that was listed, nor the good bank, which is separately owned and is not associated with African Phoenix.
“This is not a banking stock, but rather an investment holding company, and as such will most probably appeal to a different set of investors than the old, redundant African Bank,” said Cassim.
Meanwhile, Abil said it expected its earnings per share and headline earnings per share to be at least 26.55 cents lower as compared to the same period last year for the six months to end March.