GSE to do well but can’t replicate 2021 performance – Analyst

The Ghana Stock Exchange (GSE) will do well this year but cannot replicate the 2021 performance, Head of Databank Research Alex Boahen has said.

The stock market registered about 43% return for investors in cedi term in 2021, making it the second best on the African continent.

Fanmilk, Guinness Ghana Breweries Limited, Societe Generale and MTN were some of the stocks that drove the performance of the market.

But in less than two weeks of trading, the market has recorded negative return. 

Mr. Boahen however tells Joy Business the market will fairly do well this year, but doubt it will repeat the 2021 performance.

“The sectors that actually performed well last year, talk about MTN which is in the telecom sector, we talk about the FMCG sector though it surprisingly perform beyond expectation. Most of the returns came from the non-banks or the non-financial sector led by MTN.”

“Overall, last year was a very good one led by MTN. Banks actually failed to perform to expectation though. We also saw the consumer goods sector doing well even dough fundamentally we saw some weaknesses because of high cost pressures”, he added.

However, Mr.Boahen was cautiously optimistic about his prediction of the stock market for this year,

“We are cautiously optimistic about the market performance in 2022. The reason is that MTN is a major market player because of its share market capitalization.”

“So we’re cautious because as you know the mobile money business is significant growth for MTN and with this impending E-Levy (Electronic Transaction Levy) on mobile money, investors  are actually not certain about how that could hamper the growth trajectory of the mobile money business. So that is a concern with regards to MTN”, Mr. Boahen pointed out.

GSE performance in 2022

The GSE Composite Index has so far recorded -1.28%, whilst the GSE Financial Stock Index has registered 7.19% return since 1st January 2022..

Market capitalization presently stands at 64.12 billion.

For the stocks, only MTN (-2.70%) and PBC Limited (33.33%) have registered losses so far in 2021

Source: Myjoyonline