Agricultural retailer Kaap Agri has listed on the JSE’s main board.
“Listing on the JSE helps make Kaap Agri visible to a wider investor audience, which will draw in additional liquidity. The listing will also provide a platform for Kaap Agri to use its script for accretive merger and acquisition activities alongside organic growth,” MD Sean Walsh said at the listing on Monday.
He added that Kaap Agri, which is listed in the Speciality Retailer sector, was confident that it would be able to reach its target of minimum yearly growth of 15% in headline earnings a share over the next three years.
“We don’t see listing as just a single event. It’s part of the process to continue to grow our business and generate a good return for our shareholders.”
Walsh noted that there was 5% above inflation growth to be had in the agriculture retail sector and that Kaap Agri could achieve double-digit growth in the speciality building materials and do-it-yourself markets.
“We also have a dedicated team growing our retail fuel strategy going forward,” he said.
JSE capital markets director Donna Nemer said the JSE was proud to provide a liquid and well-regulated platform where a company like Kaap Agri could list alongside its peers in the wider retail industry.
“The opportunity to buy shares in retail companies allows ordinary South Africans to participate in the growth of companies they know and shop at every day,” she noted.
She added that Kaap Agri’s listing is of special significance for the JSE because of the long-standing relationship the exchange has with the agriculture sector.
“The grain handling services [provided by Kaap Agri] help to ensure the physical delivery of grain, which is crucial to the functioning of the JSE’s commodity derivatives market. We see [the company] as an important partner to the JSE,” she said.
There are 27 retail companies listed on the JSE with a total market capitalisation of R590.3-billion. The agricultural sector contributes 4.3% to the JSE’s overall market capitalisation.