When Zambia's Lusaka Stock Exchange was birthed in 1993, there was profound hope that this would be the vehicle that would bring wealth creation through the use of capital markets. As at the year 2023, only 23 companies (with a market capitalization of ZMW 74.95 billion (US$ 4.1 billion) as at December 2022) with are fully listed with another xx have remained in seldom category of “Quoted” Companies.

To put it into perspective, a Quoted Company is an almost fully listed company. As the saying goes, almost does not count and this is true about the quoted lot. What is further surprising is that the bait of the Alternative Investment Market (AIM) with its posture of “less is more” when it comes to listing requirements has also lamentably failed to lured listings. 

Quoted companies have the privilege of having their status acknowledged by the Securities and Exchange Commission as having made some effort. They also get the opportunity to participate in various instruments that the SEC has such as corporate bond auctions and other paper instruments that would allow them to raise capital through capital markets.

However, a glance at some of the quoted companies and their activity in our local capital markets shows that many hold the title of quoted and have no skin in the game. As at 2023, only two companies had any active instruments in issue: Real Estate Investment Zambia ($12 million, 12 years) and Bayport Financial Services (K88.37 million, 5 years).

One of the impediments of listing though can be argued to be issues of lack of capital and country posture. But the local bourse has been in existence for three decades with varying political climates from the Fredrick Chiluba to the now Hakainde Hichilema era with no evidence of the existence of a banana republic.

Sceptics argue that the real reason for not throwing their hats in the ring is the tardiness of compliance and the murky road to Initial Public Offering. Granted, many companies often frown upon the complexity of packaging an IPO. It requires extensive stakeholder management ranging from relations with lawyers, Investment Bankers, Investment Appraisal guru’s and Public Relations spin doctors.

However, a look at the listing rules and the requirements provided for in the xxx for investment in Zambia, it clearly shows that the quoted route is the path of least pain and if there is an option to avoid the pain of exposure and the costs involved in packaging an IPO then Boards and Management teams will be more than glad not to list. 

With the release of the Capital Markets Plan by the Securities and Exchange Commission with Cabinet approval, there is hope still for more listings. The proof however, will be in the pudding as the glaring arm of country posture continues to wave. More excuses from the quoted elite loading…