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Stock Exchange of Mauritius: SEMDEX dips to 1972.9 pts as Ponzi scheme erupts

Stock Exchange of Mauritius: SEMDEX dips to 1972.9 pts as Ponzi scheme erupts

The Stock Exchange of Mauritius closed lower last week, with the broader Semdex dipping 0.6% to hit 1972.9 points and the SEM-10 down by 0.9% to 374.3 point, as the deep-rooted financial scandal involving a Ponzi scheme of over Rs 25 billion at Bramer Bank and BAI broke out, and banking stocks altogether posted a disappointing performance. (Image:

Last week marked the start of an unprecedented financial scandal in Mauritius with the revocation of the banking licence of the Bramer Banking Corporation Ltd (BBCL), a listed entity on the official market of the Stock Exchange of Mauritius (SEM) with a last closing price of Rs 4.30 on 2 April 2015, since when trading in its shares stand suspended.

Following the revocation of BBCL’s licence by the Bank of Mauritius (BoM), the SEM immediately issued a suspension notice for BBCL. However, despite proactive efforts to limit its damage, this financial scam still impacted the market and led to lower activity on the SEM on Friday 3 April 2015, with only 2.9 million volumes and Rs 9.3 million of value traded on the official market.

Both the broad equity index and the bluechip index on the Official Market of the SEM, namely the Semdex and the Sem-10 respectively, ended in negative territory for the week closing 3 April 2015, with the Semdex declining by 0.6% to reach 1972.9 points and the SEM-10 dipping by 0.9% to close at 374.3 points.

As for hotel stock on the Official Market, New Mauritius Hotels Ltd and Lux Island Resorts Ltd indicated lower performance with decline of 4.5% and 0.8%.

Ireland Blyth limited also reported a negative movement with a drop of 0.9% to close at Rs 115.00.

The top three gainers on the Mauritian bourse were Omnicane Ltd, which inched up by 2.6%, followed by Sun Resorts’ gain of 5.6% while United Docks Ltd’s stock prices rose by 4.8%.

The worst three performers were Air Mauritius Ltd which fell by 8.1%, followed by NMH, which dropped 4.5%, and United Basalt Product Ltd, which dipped by 2.8%.

Moving to the SEM-10, decliners pushing the bluechip index to lower levels were banking stocks, with financial services majors SBM Holdings Ltd followed by the MCB Group Limited both declining by 2.0% and 0.5% respectively.

The investment cluster also reported a mixed performance with CIEL Limited, Alteo Ltd and Rogers Co Ltd inching up by 0.9%, 1.4% and 1.9% each, while ENL land Ltd and Terra Mauricia Ltd saw share prices down by 1.0% and 2.3% each.

The only bright spot on the markets’ horizon was the Developing Enterprise Market (DEM), whose corresponding index, the Demex, posted a positive performance with an increase of 1.2%, upon dividend declaration of hotels stock namely Constance Hotel Services Ltd and Hotelest Ltd together with their positive earnings results released for 2014, which drove both share prices higher by 2.7%.

Major market news during the week was the revocation of the BBCL licence, followed by suspension of trading in its shares on the SEM, for which there continues to be uncertainty regarding whether, and when, the shares will resume for trading.

Moreover, today, 06 April 2015, SBM Holdings Ltd, through a cautionary announcement, informed the public that the SBM Bank (Mauritius) Ltd agreed to make a conditional offer to purchase the assets and liabilities of Bramer Banking Corporation Ltd (in receivership) subject to a due diligence exercise being carried out on Bramer Banking Corporation Ltd and all regulatory approvals being obtained thereafter.

Finally, there was a new entry on the Official Market of the SEM, namely Delta International Property Holdings Ltd, which has started traded in USD with an opening price of USD 1.65. The opening price was based on the last closing price of Delta shares on the Alternative Exchange (“AltX”) of the Johannesburg Stock Exchange (“JSE”) on 27 March 2015. It may be noted that Delta International is a pan African USD Income underpinned property investment fund.

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