At first glance, the BRVM 10 and Composite indices gave the image of a poor performance of the BRVM in 2020. But on this marketplace, investors had a lot of other opportunities and positive events.

An average transaction value of 980.24 million CFA francs ($1.8 million) was carried out each day of activities on the Abidjan Regional Securities Exchange (BRVM) in 2020, according to the balance sheet and outlook presented on January 20 by Edoh Kossi Amenounve, the director of this institution.

This performance reflects the increase in the value of transactions, which reached 246 billion FCFA compared with 136 billion FCFA in 2010. This is the best stock market trading performance since 2018. It is also one of the positive points of a stock market that has evolved in an international context marked by Covid-19.

Another positive aspect of the BRVM in 2020 is the dynamism of its bond fund. Capitalization there reached 6051.4 billion FCFA, an increase of 43% compared to 2019. In this context, and despite a 7.4% drop in share capitalization, the total value of securities registered on the BRVM reached 10,961 billion FCFA. This is its highest level for an annual period since 2016.

Similarly, the liquidity ratio, which measures the volume of transactions over the number of marketable securities (floating), rose slightly to 3.6%. Finally, investors benefited from a 38.4% increase in values, such as dividend payments, bond repayments, and others. They reached a value of 1055.3 billion FCFA.

It's also the highest level since 2016. In detail, 300,5 billion FCFA in interest have been paid to those who invest in the bonds issued. 97 billion FCFA in dividends have been paid by listed companies. Edoh Kossi Amenounve presented these various aspects as additional information to the analysis of the performance of the regional stock exchange, beyond simply reading the evolution of the indices.

“Our action on the stock exchanges is not a short-term action. We are working for the next 30 or even 50 years. It is true, we are sensitive to the evolution of indices, but that is not the core business of stock exchanges. We are more there to transform economies, to work for sustainable development. We follow indices and market behavior, and we work to ensure that these are not discouraging investors. But we are working in the fund on what should ensure that African stock exchanges play their roles,” he said, commenting on the issue of index returns.

Indeed, on this level, the BRVM has not experienced a positive evolution. Its main indices, the BRVM 10 and the BRVM Composite, ended 2020 with value losses of 12.2% and 8.7% respectively. However, it is the equity compartment that accumulates the most individual investors.

Another area of improvement is the average return on stocks listed on the market. Designated under the name PER, we note that at the end of December 2020, it was at 10%. This level of return remains much higher than that of bonds, whose average is around 6%. But over time, we note that this dividend yield has fallen. In 2016, it was 24.25%.

The BRVM wants to encourage economic actors to use it to mobilize financial resources. With the uncertainty about Covid-19, governments and perhaps other companies after Sonatel and the Port of Dakar in 2020 could come and raise debt there. But it will also be necessary to find a way to strengthen the liquidity that short-term investors need for their respective strategies. The publication of the first 2021 results will provide a better overview of new trends.