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Full List: Innscor States Reasons For Leaving ZSE And Listing On VFEX

Full List: Innscor States Reasons For Leaving ZSE And Listing On VFEX

Innscor Africa Limited will trade on the Zimbabwe Stock Exchange (ZSE) for the last time on February 17, 2023and list on Victoria Falls Stock Exchange (VFEX) a week later.

In its VFEX listing circular seen by newZWire, the company laid out its reasons for leaving the ZSE for VFEX. Here is what Innscor is saying:

Access to USD capital

Innscor’s chances of obtaining equity financing in foreign currencies to fund capital expenditures, working capital, and regional expansion are stronger on VFEX.

Reporting in USD rather than Zimbabwe dollars will “reduce Innscor’s perceived risk” and aid prospective financiers and investors in understanding its financial performance.

Lower trading costs and increased liquidity

VFEX’s trading costs of 2.12% are lower than the ZSE’s 4.63%. This means shareholders can keep more of their capital, potentially making trading in the share more active.

It’s easier to move money in and out of VFEX. Foreign shareholders can repatriate their dividends freely in foreign currency forex and make settle proceeds from selling shares outside the country.

Tax incentives

A foreign investor on VFEX pays just a 5% withholding tax on dividends, half of what they would pay on the ZSE. The shareholder also does not pay capital gains tax on VFEX, while they pay 40% when they sell stocks on the ZSE.

Enhanced regional profile of Innscor

Innscor also sees VFEX as a plus for its credibility. According to the Innscor, “migration from the ZSE to the VFEX potentially improves the company’s regional profile and commercial standing, creating pathways to the group’s local and regional prospects”.

Reduced valuation volatility caused by currency translation

Innscor says VFEX’s USD valuation allows its shareholders to realise the true value of their investments and get a more “accurate benchmark of the stock’s performance while mitigating valuation volatility”.

Dollars make more sense

Presenting its accounts in USD, as required by VFEX, will be “more effective” in letting shareholders know the true value of the business.

Large companies have been departing the ZSE and joining the VFEX which, at launch, was described as the destination for investors seeking exposure to foreign capital.

This reflects the continued decline of confidence in the local currency, which now accounts for a smaller portion of trade in the economy.

Businesses need US money to grow, but they can’t raise enough on the ZSE to cover their needs. Additionally, VFEX is probably better protected from changes in governmental policy, such as suspension of trade and hefty tariffs.

VFEX is still small with its market capitalisation only doubling from US$259 million to US$566 million at the end of the year 2022.

Padenga, Caledonia Mining, Bindura Nickel Corporation, Simbisa Brands, Nedbank ZDRs, Seedco International, National Foods, and the Karo bond are the current members of VFEX. Axia, GetBucks, Seed Co Limited, and Innscor are expected to join.

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10 Comments

PVC 3 days ago

zero commenting hapana zvabatwa ka tukanayi tihwe @pk


Bianca 3 days ago

Ha haha

3 days ago

Bond is dying a slow but natural death. Ndiyo mhinduro yenyu


Tintin 3 days ago

all the advantages on the VFE are just 2 lure enough companies...in time Mthuli na Mangudya wozopindira vopedzera...🤔🤔🤔


3 days ago

ZSE its dead, trading in a worthless currency. There ard no new listings which are listing in the ZSE Bourse because hazvibatsire trying to raise capital using the worthless rtgs currency, its better to list on the VFEX and trade in a currency which is acceptable world wide and when making financial reports the true position of the company is shown rather than have a company inonzi yakaita a profit of zwl$50 billion to an investor who is in America or even south africa its difficult to understand


3 days ago

Tax invasion legally..... Anyway who want to trade using the worthless $zw commonly called Mararatgs


Tax Invasion 3 days ago

tax evasion

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Cupten 3 days ago

Zim dollar radhakwa let them just dollarise the ZSE to boost investors confidence


Bakers Inn Customer 3 days ago

vanoisa vim in bread to increase the weight of the loaf


Bakers Inn Customer 3 days ago

their bread has vim



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