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What to look out for in 2020

Piggy reckons that the year 2019 was full of surprises. A local currency (ZWL) was re-introduced and Monetary Authorities were busy with statutory instruments and directives while they also set up Committees and Advisory Boards. The effects of these changes are still being felt across industries in Zimbabwe. The economy contracted, capacity utilisation levels dwindled, and companies lost money in real-terms.  There were also a number of corporate transactions that were concluded. Most recently, the sale of the Meikles Hotel was approved, and we also saw Pepkor SA exiting the Power Sales investment. Bindura Nickel Corporation along with CBZ Holdings now have a new shareholder on their share registers. Good luck to them!

But that being said, the stock market still remains cheap and market capitalisation is well below historic averages. This points towards buying into some good opportunities in 2020. Piggy believes that technology will be a big theme to watch out for in 2020. The fact here is that the world has evolved and we are now in the “information age”. This means that companies that are leveraging Information Technology (IT) are set to achieve lower costs and higher returns in the new era. Globally, IT has disrupted most industries. For example, Uber in transport, Airbnb in hospitality and PayPal in financial services have become the new pacesetters. Here is an interesting infographic on some of the leading technology companies;

Zimbabwe is definitely not an exception in this global technology revolution. GSMA Intelligence estimates that smartphone adoption will continue to see rapid growth in the Sub Saharan Africa (SSA) region despite affordability challenges. In the case of Zimbabwe, low-cost handsets are doing the trick.  Thanks to new initiatives such as Mara Phones International that has developed the Mara X and Mara Z smartphones that are targeting the African market. Consumers in the region no longer view mobiles as just a communication device but also as a primary channel for getting online and a vital tool to access life-enhancing services. Mobile network assets and services, such as APIs, cellular IoT, mobile money and billing platforms, are enabling sustainable business models for key services across verticals in the SSA region.

Piggy believes in the long-term potential in technology companies like Cassava. It should be highlighted that the banking game has completely changed, and Cassava’s Eco-Cash has disrupted the sector given that it now has more account holders than any of the traditional banks. Further, Brick & Mortar branches are disappearing and no longer make much sense given that consumers have adopted online platforms. This of course has been a global trend and it’s a no brainer that banks that have been left out in this technology wave are headed for “extinction”. That said, Fintechs like Cassava are promising more than just the convenience to transact or get a small loan. They are holding the “Financial Inclusion” card and they are clearly winning in this game.

Cassava is in its growth phase and it has proven its potential through its consistent innovations in the market. The company has permeated into the Transport (Vaya), Insurance (Ecosure and Moovah), Financial Services (Ecocash), Service (Ownai), Education (EduTech), Health (Maisha) and Agriculture (EcoFarmer) sector where it is disrupting these sectors with innovative products that leverage off technology. Piggy is ploughing some money in Cassava this coming 2020!

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