Paul Nyakazeya, Group Digital Editor 
A LOCAL equities firm is betting on stocks in sectors positioned to benefit most from Zimbabwe’s US$1 billion International Monetary Fund (IMF) stimulus package to continue to rise despite a general slowdown on the local bourse.
With demand for stocks diminishing amid sustained stability in the economy, the Zimbabwe Stock Exchange (ZSE) lost 2,83 percent in August, its worst performance in nine months.
Over the past few years, the market has rallied on the back of currency instability, with demand for real assets driving interest in equities.
But, since June 2020, policies put in place by monetary authorities have seen inflation falling from a peak of 838 percent last July to 50 percent last month, with the stimulus package from the IMF raising optimism of a further decline, which many analysts say points to further “correction” on the ZSE.
Akribos Research Services (Akribos), however, says the stimulus could have an opposite effect on selected counters.
“The Ministry of Finance and Economic Development has indicated four focus areas on how the SDR allocation is going to be used, that is the social sector; productive sector; infrastructure investments and building foreign exchange reserves. We expect listed and unlisted companies in the above targeted economic sectors to benefit from government spending,” the equities firm said last week in a note.
“Listed equities in strategic sectors such as consumer discretionary, infrastructure, mining and ICT are likely to outperform in the upcoming month. Our top picks are Delta, Innscor Africa, Simbisa, National Foods, Econet, Cassava, Seed Co, Masimba and Lafarge,” Akribos said.
This also comes as Delta is expected to recover with an increase in volumes across the region on the back of improved agriculture output and increased outdoor activities while Innscor Africa and NatFoods are expected to benefit immensely from the improved agriculture sector output harvest as some of the country’s largest grain users.
“Lafarge Cement Zimbabwe has anchored its growth prospects on continuous product and service innovation as key enablers for the company’s growth targets. With the SDRs likely to boost the manufacturing sector, Lafarge is in a prime position to experience a potential bull run,” Akribos added.
The firm said it expects government and private sector infrastructure spending to remain relatively strong, leading to improved performance of infrastructure players like Masimba and Lafarge.
“The ICT sector is in our view poised for continued growth amidst growing digitalisation of business models and digitisation of business processes. The growing digital native population in the world will remain a major driver of consumption of ICT services hence our view that Econet and Cassava will be good investment prospects. The strategic nature of agriculture and food security concerns make Seed Co a good investment option in our view,” Akribos said.
newsdesk@fingaz.co.zw
