Ghana: GAX Roadshows Yielding Results, More Companies to List

Ghana Stock Exchange

Accra, March 14, 2018//-Manager of the Ghana Alternative Exchange (GAX), a parallel market operated by the Ghana Stock Exchange (GSE) with focus on Small and Medium Enterprises (SMEs) with growth potential, says their roadshows to businesses to urge them to listing on the GAX are yielding results.

David Tetteh, who disclosed this at a day’s a workshop on ‘Enhancing the Capacity of Financial Journalists on the Capital Market’ organised by the USAID and Institute of Financial Journalists (IFEJ) held in Accra, said: “Since we started doing roadshows on the GAX, companies have shown interest in listing on the GAX”.

Mr Tetteh was optimistic that they would meet their target of listing 50 companies on the GAX by the end of 2020.

Since its inception in 2013, GAX has only four listed companies under its watch. This makes analysts to doubt whether the target can be achieved.

But Mr Tetteh insisted that if they continue their aggressive awareness creation they would be able to meet the target.

He added: “We are also relaxing the requirements, making it cheaper and putting in some incentives for the companies to get onto the market. It also includes investor education as well as education for both entrepreneurs and the companies”.

“So being aggressive and seeing the avenues we have created, we should be able to list a good number of companies”.

What account for the low interest in the past

Mr Tetteh attributed the low interest in listing on the GSE equity market in the past to low education, unfavourable economic condition, and the lack of information.

“A lot of people are not aware that the GAX exists and they can raise capital. They are not aware of the benefits they stand to gain when they get listed, they are not aware of the incentives that we have put in place”, he stressed.

As part of the incentives, initial processes including underwriting and advisory service costs are free.

“The second challenge is general, that the economy itself did not favour equity investments so people are putting more funds into money market investments, so it wasn’t good timing to bring companies onto the GAX. Now it looks like things are stable that is why the GSE is the best performing market in the world this year.”

According to Mr Tetteh, companies seeking to be listed on the GAX would have to raise at least, GHS250, 000 to go on the market. Already, two companies including Digicut Production & Advertising, a subsidiary of Groupe Nduom have been approved for listing, whiles three companies are being processed to list by the close of this year.

By Masahudu Ankiilu Kunateh, African Eye Report


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