Paul Bwiso: ‘It’s the right time to invest on the stock market’

A section of the public think that you and your team as USE aren’t doing enough to attract new listings or stimulate activities on the stock market. What is your response to this?

There are different ways of attracting companies to come and list on USE. We have two market segment – one that has very minimal requirements and that is the Growth Enterprise Market Segment and the main market that is stringent.

Now, many of the investors we have met say, ‘yes we have made some money and we also have our businesses. How shall we benefit with sharing our companies?’ They feel that there’s no incentive.

The funding structure in Uganda is a bit complicated; everybody is playing in the short spell. The long term fund managers with long term assets are always putting their investment in the short term because the government is always issuing treasury bills and bonds for monetary policy.  Everybody is investing in that space and they are fairly getting a good returns of 12-16%.

Now, the companies that need capital at this point in time are not using the market because they have issues.  In addition, a lot of our businesses are family owned, and one of the challenges for such companies is that to become a listed company, they have to open up. For instance, the chairman cannot be the chief executive officer, have non-executive directors, which the owners are not willing to surrender.

However, we are still telling companies to approach USE when they are growing because that is when people will have interest in them.  We do quite a lot of meetings, gatherings with the investors and we also have a team and other stakeholders – brokers that are always out taking to various companies.

What is the future outlook of the stock market?

The outlook is quite bright; we are focusing a lot on technology/ innovation and also creating awareness of our products. I think there’s a better look to the stock market and we are going to be able to grow. We do know some listings will come though are taking longer. We are also in the process of finalisation demutualisation – getting out the mutual organisation – and become a public limited company. That means that USE will now be a profit making company, making us competitive. At the moment, we are simply a regulator of the market.

USE market turnover, share volume & market capitalization for past 5 years

Source: USE and CMA

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