HARARE – Econet Wireless Zimbabwe’s (EWZ) impending departure from the Zimbabwe Stock Exchange (ZSE) is poised to erase more than US$700 million from the bourse, a development that analysts warn will strip away one of its most actively traded and widely held stocks, further eroding investor confidence.
Econet yesterday revealed its intentions to voluntarily delist from the ZSE, citing corporate actions aimed at rectifying what it described as a “grossly undervalued” share price, unlocking shareholder value, improving access to capital, and bolstering long-term competitiveness.
The proposed delisting is contingent upon shareholder approval at a date yet to be determined.
On December 3, when the initial announcement was made, Econet’s market capitalisation stood at US$628.31 million, despite total assets valued at US$957.32 million as of August. This underscored the extent of the perceived undervaluation.
The announcement sparked renewed interest from investors, driving Econet’s market capitalisation to US$1.01 billion by December 9, briefly making it the ZSE’s largest listed company. However, the valuation subsequently stabilised at US$739.28 million on Monday.
With Econet’s exit, the ZSE’s total market capitalisation is expected to plummet in real terms to approximately US$2.35 billion, from over US$3 billion recorded on Monday.
Financial securities analyst Kuda Taimo, speaking to NewsDay Business, cautioned that Econet’s departure would remove a “cornerstone stock that contributes meaningfully to daily turnover, index weighting and institutional participation.”
“Reduced liquidity tends to exacerbate volatility, widen bid-offer spreads, and discourage both local and foreign investors — creating a self-reinforcing cycle of declining market relevance,” he stated.
Taimo emphasised that Econet has historically been one of the most liquid and widely held stocks on the exchange, adding that its potential exit comes at a time when the ZSE is already grappling with shrinking market breadth and persistent liquidity constraints.
He acknowledged that while this strategy may be rational for shareholders seeking long-term value realisation, its consequences for the ZSE were far less benign.
The analyst also highlighted a growing trend of delistings in 2025, raising concerns about the long-term credibility of the exchange.
“The OMTT ETF delisted in January, Khayah Cement exited the market in May, Truworths followed in July. NTS (National Tyre Services Limited) is scheduled to delist on 31 December 2025,” Taimo noted.
“Should Econet shareholders approve the proposed delisting, this would represent the fifth delisting from January 2025, amplifying concerns around the long-term attractiveness and credibility of the exchange.”
Econet has advised shareholders to exercise caution when trading its stock.
The company stated that, for several years, it has traded at a “significant discount to its peers across Africa, which trade at 6 – 8x EV/EBITDA”.
In an effort to address this, the telecoms giant has placed its towers, real estate, and power assets under a newly formed entity, Econet Infrastructure Company Limited (Econet InfraCo), which will be listed on the Victoria Falls Stock Exchange.
“This approach enables clearer visibility of asset values, focused capital allocation, and a distinct operational strategy for infrastructure deployment and management,” Econet explained.
Econet will retain a 70% stake in Econet InfraCo, while up to 30% of the shares will be allocated toward settling the exit offer for shareholders who choose not to remain invested following the delisting.
The delisting of Econet Wireless Zimbabwe represents a significant blow to the ZSE, potentially impacting investor confidence and market liquidity. The move raises questions about the long-term health and attractiveness of the exchange, particularly in light of other recent delistings.
The company’s decision to list Econet InfraCo on the Victoria Falls Stock Exchange suggests a strategic shift towards unlocking value and attracting investment in its infrastructure assets. However, the overall impact on the Zimbabwean market remains to be seen.
The delisting also highlights the challenges faced by Zimbabwean companies in attracting fair valuations on the ZSE, prompting them to seek alternative strategies to enhance shareholder value.
As Econet Wireless Zimbabwe prepares for its exit, the ZSE faces the task of addressing the concerns raised by analysts and investors, and working to restore confidence in the market. The loss of such a significant player underscores the need for reforms and initiatives to attract and retain listings, ensuring the long-term viability of the exchange.
The coming months will be crucial in determining the impact of Econet’s delisting on the ZSE and the broader Zimbabwean economy. Investors and market participants will be closely watching developments as the exchange seeks to navigate this challenging period.
The delisting of Econet Wireless Zimbabwe from the ZSE is a complex issue with far-reaching implications. While the company’s management believes it is in the best interests of its shareholders, the move raises concerns about the future of the exchange and the overall investment climate in Zimbabwe.
The ZSE must take proactive steps to address these concerns and ensure that it remains a viable platform for Zimbabwean companies to raise capital and attract investment. This will require a concerted effort from regulators, market participants, and the government to create a more attractive and stable investment environment.
The loss of Econet Wireless Zimbabwe is a wake-up call for the ZSE, highlighting the need for urgent reforms and a renewed focus on attracting and retaining listings. The future of the exchange depends on its ability to adapt to the changing economic landscape and provide a compelling value proposition for Zimbabwean companies and investors alike.
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