CRDB is enjoying a remarkable dash for its shares having sold an impressive 5.0 million shares this week alone. The sudden increased appetite for CRB shares is not without cause, the bank strategically announced a possible 6.52per cent increase in dividend payout.
Now, even though the percentage increase is only a proposal (subject to approval by the Annual General Meeting) the public is gabbling up the shares in lure of the possible increased payout.
The new amount was first proposed in the bank’s annual report for 2020, the 6.52 percent raises the initiatial USD 0.0073 (17/-) that was the payable dividend in 2019 to a lucrative USD 0.0025 (22/-) per share.
In its weekly Market Synopsis, Orbit Securities said that CRDB shares closed the week at usd 0.11 (245/). The impressive increase set CRDB ahead of the park in a week that had only three gainers on the Dar es Salaam Stock Exchange (DSE).
In its comment, Orbit Securities said, “The domestic market had three gainers and one loser as CRDB leads the charging bull.”
The development comes after the Bank of Tanzania (BoT) issued new circular allowing banks to offer bonuses and dividends but only after a bank maintains its Cost to Income Ratio (CIR) below 55 per cent and caps its NPLs at 5.0 per cent.
Another sector pundit, Vertex International Securities remains optimistic; “We expect this momentum to continue next week as investors anticipate dividend announcements.”
New Heights: CRDB nets record-high profits
Notably, CRDB broke its 2015 USD 56million (129bn/-) record when its net profit jumped to almost USD 66 million (153bn/-) last year from a little over USD 53 million (123bn/-) in 2019.
Several brokerage firms’ reports last week showed that Twiga Cement share price appreciated by 5.0 per cent to close off the week at USD 1.27 (2,940/-) and NICOL also gained 2.5 percent to close at USD 2.088 (205/-) per share.
“The gain on NICOL may be associated with the performance and expected dividend payout from NMB Bank,” Orbit Securities said.
As for the underperformers, you have Jatu, the only domestic loser, suffering a counter price fall of 10.96 per cent to close the week at USD 0.56 (1,300/-) per share.
On the flip side of things, EABL went up by a slight 0.54 per cent on a weekly basis while Jubilee Holdings (JHL) and KCB Bank dropped by 3.28 per cent and 1.1 per cent respectively.
EABL was the cross listed gainer that helped push the DSE All Share Index (DSEI) higher, despite two cross listed losers during the week. DSEI was also on the up rise, after gaining 4.33 points following a 0.22 per cent growth of the total market capitalization.
“The total equity turnover grew by almost four times while the volume of shares traded went up more than sixteen times due to a block transaction on the CRDB counter,” Orbit said noting that, all in all, the top mover during the week was CRDB, which accounted for 92.6 per cent of the total equity turnover for the week.