DAR ES SALAAM Stock Exchange (DSE) has registered a price earnings (PE) ratio increase for domestic listed companies in the first quarter of this year. The weighted average market PE ratio for domestic listed companies was trailing at 23.45 times three months to March, which was slightly higher than the PE ratio 21.00 times for three months to last December.
DSE CEO’s Quarterly Note for March attributed the share price for domestic listed firms to its earnings per share.
“This increase was attributed to the increase in prices relative to the reported earnings during the quarter,” CEO Quarterly report issued Tuesday showed.
Normally, the PE ratios are used by investors and analysts to determine the relative value of a company’s shares in an apples-to-apples comparison and compare a company against its own historical record or to compare aggregate markets against one another or over time. On the other hand, the trailing weighted average dividend yield declined to 3.8 per cent compared to 3.9 per cent that was reported as of last December.
Cumulatively, the report said, the market size for the 22-domestic listed companies, as measured by market capitalisation, increased slightly by 0.96 per cent during the quarter.
The total domestic market capitalisation increased from 9,161.60bn/- as of last December to 9,249.78bn/- at the end of last month.
“But, the increase in prices in the two counters added more to the total domestic market capitalisation proportionately as compared to the decrease in prices on these two counters,” the report said.
This increase was a result of increase in prices for DSE by 25 per cent to 1,100/- from 880/- and CRDB 18 per cent to 230/- from 195/-. During the quarter, Jatu, agri-industry start-up, price decreased by 43 per cent to 1,680/- from 2,980/- and Tanga Cement, Simba, by 19 per cent to 405/- from 500/-.
However, the equity market turnover decreased during the quarter compared to both the last year’s quarter four and last year’s first quarter. The equity trading turnover was merely 23.3bn/- at the end of three months to march.