Chasing yield

Zimbabwe unveils a gold-backed currency, Adenia closes record $470m fund, and how to boost your portfolio with dividend stocks.

Author

Anthony Miclet
April 10, 2024

Good morning and welcome to another Daba weekly newsletter.

Where should foreign investors considering Africa be putting their money? BlackRock Inc., the world's largest asset manager, thinks Kenyan equities are promising. 

Despite being the world's worst performer last year, the Nairobi bourse has rebounded strongly this year, with the benchmark index surging by 48% in dollar terms—a remarkable turnaround from a 43% decline in 2023.

In top stories from the past week:

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ICYMI: We Rolled Out Exciting Updates on the Daba App! 📱

Hey Daba Community,

We're thrilled to announce some major updates to our mobile application! We've been listening closely to your feedback and have been hard at work to bring you a faster, more reliable experience with some fantastic new features.

Here's what's new:

💰 Wallet - Deposit and Withdrawal: Now you can easily deposit and withdraw funds in CFA Franc, USD, and Euro right from your Daba wallet! Whether it's via debit card, bank transfer, or Mobile Money, managing your finances just got a whole lot simpler.

＄ Currency Display: Choose your preferred currency to view your balance and wallet status. With options including USD, Euro, and CFA Franc, personalizing your financial experience has never been easier.

📈 BRVM Stock Exchange: Dive into the world of stock market investment with ease! You can now invest in stocks listed on the BRVM directly from our app, with an automated order placement process for seamless transactions.

🐞 Bug Fixes: We've squashed pesky bugs reported by you, ensuring smoother navigation and enhanced stability within the mobile app.

With these updates, we're making it easier than ever for you to manage your investments and financial transactions on the go.

Tap the button below to check them out now and stay tuned for more exciting features coming your way soon! 🚀

Happy investing!

Here are last week’s top stories

Mixed markets

Dividend yield hunt lures investors to Onatel; BTC, commodities surge

Burgeoning demand for high dividend yields drove an investor frenzy over Onatel shares last week with the stock price soaring by 7.24% to 2,445 FCFA ($4.04) on Friday. It offers the highest dividend yield on the BRVM. Equities were mixed across other markets.

Bitcoin buckled below last week and on Tuesday slipped to under $69,000, paring optimism after Monday's rally sent its price above $71,000. BTC’s fourth halving event is expected to take place later this month. Gold has soared and hit one record after another this year, with the bulk of the bullish move taking place over the past two months. 

Brent crude hit over $91 on Sunday as global oil prices saw a second straight weekly gain, reaching six-month highs. Rising tensions between Israel and Iran raise concerns about further supply constraints.

PE firepower

Adenia closes $470m Africa fund with IDF, Norfund among backers

Private equity firm Adenia Partners raised a record-breaking $470m for its fifth and largest Africa-focused fund, seeing an increase in target equity check size to about $40m. 

New investors including Norfund AS, US International Development Finance Corp, and Canada’s Findev Inc. participated in the raise.

The fund is also backed by major players like Public Investment Corp., and pension funds from Ghana and Kenya, reflecting growing investor confidence in Africa's private equity sector.

Gold standard

Zimbabwe replaces dollar with new bullion-backed currency ZiG

The southern African nation has launched a new national currency called the ZiG, short for Zimbabwe Gold, and backed by 2,522 kilograms of gold and around $100m in foreign currency reserves held by the central bank.

This is its sixth attempt at establishing its own currency since 2008 when the country experienced hyperinflation that reached over 500 billion percent according to IMF estimates. 

Previous attempts to create a stable national currency have failed, leading Zimbabwe to adopt the US dollar and other foreign currencies in recent years.

Headline roundup

A summary of the major business, tech, and finance headlines of the past week.

Macro & Markets

VC Funding & Startups

Other Deals & Expansion

Funds & Accelerators

Startup Opportunities

Discover funding and accelerator opportunities to boost your startup's growth.

Our insight for the week

Get more context into events shaping Africa’s economic landscape.

How can you optimize your portfolio with dividend yields? Investors seeking to optimize their portfolios should look no further than the lucrative dividend yields available on African stock exchanges. 

By strategically investing in companies with a history of paying out high dividends, you can generate steady passive income to complement potential capital gains.

The key is the dividend yield - the ratio of a stock's annual dividend per share to its current market price. 

The higher the yield, the more cash flow an investor can expect. 

Many well-established African companies offer dividend yields far exceeding those found in more developed markets.

For example, BOA Benin, listed on the BRVM regional exchange, is slated to pay a 706 FCFA per share dividend in May 2024. 

This translates to an impressive 10.17% yield for investors who buy the stock before the ex-dividend date.

The Daba investment platform makes it easy to access and research such high-dividend opportunities across Africa and our suite of tools empowers you to make informed decisions and construct a portfolio optimized for steady dividend income.

To learn more about leveraging dividend yields to enhance your African investment strategy, read our detailed guide available on our website. Tap the button below to get started.

That’s it for this week. Next Frontier is sent once weekly. Think your friend or colleague should know about us? Forward this newsletter to them. They can also sign up here.

If you haven’t, you can also download the Daba app to get daily bite-sized insights into African economies, industry and country reports, and access investment opportunities.

Catch you next week!