Africa-Press – Tanzania. JATU stock price is heading towards a Santa Claus rally after gaining considerably since Christmas.
A Santa Claus rally is a calendar effect that involves a rise in stock prices during the last five trading days in December and the first two trading days in the following January.
Jatu, an agri-based startup, so far is the best performing stock on DSE this year in terms of price appreciation. Jatu, the latest listed firm on the Dar es Salaam Stock Exchange (DSE), opened this week by gaining 9.7 per cent to 2,260/- from 2,060/- before Christmas.
Again, the share rallied by 9.73 per cent to 2,480/- on Tuesday, before gained again by 9.68 per cent to 2,720/- on Wednesday.
Zan Securities Chief Executive Officer Raphael Masumbuko predicted some shares to rally in the last week of this year.
“We expect the market to close this year on a high note owing to a surge in Jatu price…,” Mr Masumbuko said in the firm’s latest Weekly Market Wrap-ups.
Jatu share has been rallying since when it was listed on the bourse a month ago. The share was listed at 420/-, but appreciated to 2,720/- on Tuesday, which is five times gain in a month.
According to a DSE daily market report, the firm market cap climbed up from 1.08bn/- on the listing day to 5.89bn/- on Tuesday to overtake Uchumi Supermarkets with market capitalisation of 1.82bn/- and TaTePa market cap of 2.24bn/- and MuCoBa with 3.26bn/- while TBL is the largest in terms of market cap at 3.216tri/-.
These four companies are the only ones which have less than 6.0bn/- market cap out of 28 listed stocks. Jatu was one of the four domestic listed companies whose shares gained on DSE this year.
Others are CRDB Bank, Twiga Cement and Nicol. Analysts believe that investors are buying the Jatu’s stocks to have a membership requirement status which will warrant one to also participate in the farming project.
Orbit Securities, a leading stock brokerage firm, said in a report recently that the mystery of the sharp rise in the price of Jatu was mostly due to two main factors.
“One is the membership requirement to own at least 200 shares to be eligible to participate in the farming project. “With a limited number of shares, the requirement raises the counter’s price,” Orbit said on its weekly Market Synopsis report.
Orbit also said the second factor was the sharp rise itself which sets a momentum of speculators to vie on the shares.
Jatu is involved in mainly four activities being agricultural activities, industrial activities, networking marketing and packaging and sales.
According to extracts in the Memorandum of Information (MoI), revenue has been doubling since 2017, displaying a very sharp growth still by the company.
