CAPE TOWN: Stellenbosch-based Capitec has been the best-performing counter on the JSE’s banking index so far this year and has risen by more than 40% in the first half of 2015.
When Capitec listed in 2002 its shares traded just under R1. Over the past 12 years it has experienced massive growth, despite concern that unsecured credit is unsustainable. Last August, when African Bank, SA’s largest unsecured lender, failed, Capitec’s share price fell from above R240 at the end of July to R210 by August 8, but it has since rallied strongly to about R480.
“This is a quality company with better than expected market growth. I feel very confident the management team can continue to deliver,” PSG CEO Piet Mouton said. A PSG associate owns roughly 30% of Capitec. “There are very few businesses of this kind. Maybe with an offer of R995 per share you can get me to the negotiating table.”
Capitec’s stock is up about 40% this year, Standard Bank’s 10.56%, FirstRand 4%, Barclays Africa less than 1%, Investec 13%, Sasfin 19% and Finbond 39%. Nedbank is down 3.5%. Some analysts have said Capitec’s transactional banking offering is competitive and has helped it to diversify its offering beyond unsecured credit, a move that has boosted revenues. Capitec posted a 26% rise in headline earnings to R2.5bn for the year ended this February. Interest income grew 14% to R10.8bn with net transaction fee income up 35% to R2.6bn.
