MTN Rwanda listing: What it means for the telecoms sector

In a groundbreaking move, MTN Rwanda is set to list 20% of its shares on the Rwanda Stock Exchange, making it the tenth firm to be listed on the local bourse. This move has sparked discussions about what it means for the market and the telecom sector in Rwanda as a whole. B.K. Capital CEO, Carine Umutoni, shared insights on the significance of this listing in a recent interview with CNBC Africa's Julius Bismongo. The telecom sector in Rwanda has been witnessing a remarkable growth trajectory, with MTN Rwanda leading the charge. Over the past decade, MTN has surged its subscriber base from 4.5 million in 2018 to approximately 6.1 million in 2020, marking a substantial 36% growth in just two years. This growth highlights the lucrative investment opportunities present in the telco industry, particularly in the mobile money and fintech segments. Umutoni emphasized the potential of the mobile money business, noting its resilience even in the post-COVID era with the increasing shift towards cashless transactions. This trend has opened up significant avenues for investors, making it an opportune moment to consider investing in the telecom sector. With MTN Rwanda's imminent listing on the Rwanda Stock Exchange, there is a sense of excitement and anticipation in the market. Umutoni underscored the value of having a renowned brand like MTN join the local bourse, citing it as a boost to the visibility and trust in the Rwandan stock market. The presence of such a reputable company is expected to attract more investors and solidify Rwanda's position as a burgeoning financial hub. The direct shareholding opportunity offered by MTN's listing is seen as a game-changer for investors. Previously, investors relied on Crystal Telecom, an SPV holding MTN Rwanda shares, for information on MTN's performance. However, with MTN becoming a listed entity, investors can now access transparent and timely updates directly from the company, enhancing efficiency and removing the need for a third-party intermediary. Furthermore, the listing simplifies dividend payouts and eliminates double taxation, streamlining the process for shareholders. This newfound transparency and efficiency are anticipated to generate heightened interest among investors and drive market momentum, creating a conducive environment for future listings on the Rwanda Stock Exchange. Umutoni also highlighted the positive spillover effects of MTN's listing, suggesting that it could inspire other companies to consider going public. The increased demand and liquidity in the market resulting from additional listings are poised to attract more companies looking to raise capital through the capital market. As Rwanda positions itself as a financial center, the influx of reputable companies listing on the stock exchange is seen as a testament to the country's growing economic stature. Addressing concerns about transparency, Umutoni emphasized the benefits of listing on the stock exchange in enhancing corporate governance and operational efficiency. Contrary to some apprehensions, she viewed transparency as a catalyst for improving business performance and status, signaling that listing on the Rwanda Stock Exchange could propel companies towards greater success and growth. In conclusion, MTN Rwanda's listing on the Rwanda Stock Exchange is a significant milestone that is poised to reshape the telecom sector in Rwanda and elevate the country's financial landscape. The move not only signifies a vote of confidence in Rwanda's market but also opens up a new chapter of opportunities for investors and companies alike.