Nine companies listed on the Malawi Stock Exchange (MSE) are projecting substantial profit growth for the financial year ending December 31 2024, with Nico Holdings plc leading the pack with an expected profit increase of up to 122 percent.
According to trading statements released Monday and earlier in the month, Nico Holdings anticipates its consolidated profit-after-tax to reach between K122 billion and K131 billion, representing a remarkable increase from K59 billion reported in 2023.
The company’s profit that is attributable to shareholders is expected to grow by between 110 percent and 126 percent to reach K65 billion or K70 billion.
In the banking sector, National Bank of Malawi (NBM) projects its consolidated profit-after-tax to land at between K92.97 billion and K98.25 billion, marking a 29 percent to 37 percent increase from K71.96 billion posted in 2023.
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FDH Bank expects even stronger growth, with profit-after-tax forecast indicating that it would reach K59.2 or 62.5 billion, representing a 66 percent to 75 percent increase from K35.6 billion registered in 2023.
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Standard Bank also anticipates profits of between K78.8 billion and K86.7 billion, up 50 percent to 65 percent from K52.5 billion.
FMB Capital Holdings plc (FMBCH) projects its total consolidated profit to increase by $15 to $24 million, representing growth of between 20 percent and 30 percent from $78.7 million in 2023, with profit attributable to owners expected to rise by 18 percent to 28 percent.
In the telecommunications sector, Airtel Malawi expects profits to range between K43.1 billion and K47.7 billion, a dramatic improvement from last year’s K15.4 billion loss.
Similarly, TNM projects profits amounting to K8.14 billion and K9.11 billion, reversing its K4.76 billion loss in 2023.
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In the hospitality sector, Sunbird Tourism plc forecasts profits to be between K10.7 billion and K11.8 billion, more than doubling its 2023 performance of K5.3 billion.
However, Blantyre Hotels plc expects to register increased losses of between K1.7 billion to K1.85 billion, primarily due to finance charges related to its Lilongwe Hotel project and the consolidation of Oasis Hospitality Limited’s results.
In an interview, Stockbrokers Malawi Limited Equity and Stock Market Analyst Kondwani Makwakwa said the release of trading statements by listed companies had a positive impact on investor confidence.
“This boost in confidence often translates into upward movements in share prices, resulting in potential capital gains for investors. Furthermore, the strong financial performance may signal the stability and growth potential of these companies, reinforcing positive market sentiment.
“Additionally, the anticipation of strong profitability often leads to expectations of higher dividends, further enhancing the attractiveness of these stocks to both existing and potential investors,” Makwakwa said.
In a separate interview, MSE Chief Executive Officer John Kamanga said this had already been reflected in the market, in terms of return on investment, which currently stands at 52.7 percent.
He said the nine companies had registered price appreciation of more than 30 percent, which means the real return is above 3 to 4 percent above the inflation, which is at 27 percent.
“Despite economic challenges, the financial sector has registered remarkable returns and that’s why you find that most investors are also coming in.
“Furthermore, we are currently awash with lots of pension funds, which are in excess of about K2.8 trillion. These funds are looking for avenues of investment and you find that most of the area where they actually invest is the capital market, because the stock market is actually hosting around 51 percent of the pension funds. That’s also a demonstration of trust and confidence inn our market,” Kamanga said.
