DSE

How to Invest and Trade at the Dar es Salaam Stock Exchange (Tanzania Stock Exchange).
The Dar es Salaam Stock Exchange (DSE) was established in 1996. Currently, the financial products traded at DSE are shares and bonds (corporate and treasury). There are 28 listed equity securities. DSE’s total market capitalization reached TZS 16.834 trillion at the end of June 2024. This is equivalent to about USD 6.3 billion and about +15.1% compared to the end of 2023. 

Companies Listed at the DSE Stock Exchange

*Taken over by NMB Bank.

History & Key Milestones

The DSE was established in 1996 as a non-profit making body to enhance the country’s capital market. Its formation was part of a broader initiative to reform Tanzania’s financial sector, ensuring better regulation and increased transparency.

Since its inception, the DSE has achieved several milestones, including the introduction of electronic trading systems, the launch of various market indices, and the listing of a growing number of stocks from companies and bonds from both private and public sector entities.

The first company to list at DSE was Tanzania Oxygen Limited (DSE:TOL) in 1998, which was also the first state-owned company selected for privatization through the capital markets.

In 1999, the Guidelines for the issuing of corporate bonds were released, and in 2022 the listing and trading of treasury bonds at the exchange started.

In 2013, DSE launched its second-tier market: the Enterprise Growth Market (EGM).

In 2014, the Foreign Investors Regulations were amended and limitations on foreign investors were lifted. This provided foreigners access to participate in the stock exchange without restrictions on the equity market. The foreign investors’ participation in government securities which was previously prohibited was partially amended to allow East African Community (EAC) residents to acquire, sell, or transfer government securities of up to 40% of the amounts issued. However,  EAC resident investors from the same country cannot exceed two-thirds of that 40%. Government securities are still blocked for non-East African investors.

In 2016, DSE was demutualized and reincorporated as a public limited company and self-listed at DSE in 2017.

Structure and Governance

The DSE operates under the oversight of the Capital Markets and Securities Authority (CMSA). The exchange is managed by a board of directors and an executive team responsible for day-to-day operations. The current Chief Executive Officer (CEO) is Peter Nalitolela.

Dar es Salaam Stock Exchange Performances

DSE Performances in 2024

Market Turnover & Liquidity

In 2024, the Dar es Salaam Stock Exchange (DSE) recorded a 1.47% increase in total equity turnover, rising from TZS 225.35 billion in 2023 to TZS 228.66 billion. This growth was primarily driven by a 27.37% increase in trading activity on the normal counter, where turnover rose from TZS 47.14 billion in 2023 to TZS 60.05 billion in 2024.

However, this growth was partially offset by a 5.39% decline in block trade turnovers, which dropped from TZS 178.20 billion in 2023 to TZS 168.61 billion in 2024. The decline is attributed to the absence of significant one-time transactions, such as the TZS 106 billion acquisition made by Heidelberg Materials to acquire a majority stake in Tanga Cement in 2023.

Market Capitalization

The total market capitalization of the DSE grew by 22.29%, reaching TZS 17.87 trillion by the end of 2024, compared to TZS 14.61 trillion at the end of 2023. The domestic market capitalization also grew by 7.38%, rising from TZS 11.40 trillion in 2023 to TZS 12.24 trillion in 2024.

Market concentration is significant, with a few large stocks dominating the market capitalization. Tanzania Breweries Limited (TBL) holds the largest share of market capitalization at 18.00%, followed by NMB Bank at 14.97%, East African Breweries Limited (EABL) at 14.34%, and Kenya Commercial Bank (KCB) at 12.97%. These four companies alone account for over 60% of the total DSE capitalization.

The table below summarizes the 2024 Annual Turnover, Market Capitalization, and Annual Turnover-to-Market Cap Ratios for major companies on the DSE, providing insights into their trading activity relative to their market size:

Note: The total turnover for all listed companies combined was TZS 228.66 billion, representing a 1.87% turnover-to-market cap ratio for 2024, slightly lower than the 1.97% ratio in 2023.

Indexes Performances

All Share Index (DSEI)
The DSE All Share Index (DSEI), which tracks the performance of all publicly traded companies, increased by 22.23%, closing at 2,139.73 points in December 2024 compared to 1,750.63 points at the end of 2023.

Local Market Performance
The Tanzanian Share Index (TSI), which tracks the performance of domestic companies, grew by 7.30%, closing at 4,618.78 points at the end of 2024 compared to 4,304.40 points in 2023. The local market capitalization growth was driven by strong performances from companies such as CRDB Bank (DSE: CRDB), which surged 45.65%, and DSE Plc (DSE: DSE), which rose 31.11%. These gains highlight the resilience of key local firms despite global economic uncertainties.

Stock Performances

Notable Stock Performances
Several stocks contributed to the DSE’s robust growth in 2024:

• CRDB Bank (DSE: CRDB): +45.65%
• DSE Plc (DSE: DSE): +31.11%
• NICO Insurance (DSE: NICO): +28.00%
• NMB Bank (DSE: NMB): +18.89%

However, certain stocks underperformed:

• Tanzania Portland Cement (DSE: TPCC): -17.43%
• Swissport Tanzania (DSE: SWIS): -16.67%

Foreign Investors
Foreign investor participation in the DSE saw a 26.87% USD return, underscoring the attractiveness of the market to international investors.

DSE Performances in 2023

Equity Turnover

In 2023, the Dar es Salaam Stock Exchange (DSE) witnessed a remarkable increase in equity turnover. The total transaction value in the equities market surged to TZS 225.35 billion, marking a substantial 68.3% rise from TZS 133.89 billion recorded in 2022. Analysts attribute this notable increase to a significant block trade amounting to TZS 106.25 billion in November 2023. This transaction involved Scancem D.A, a subsidiary of Heidelberg Materials, acquiring a majority stake from Afrisam, the parent company of Tanga Cement Company Limited (DSE: TCCL).

When excluding this exceptional transaction, the DSE’s turnover stands at TZS 119.09 billion. This represents an 11% decrease compared to the previous year’s turnover of TZS 133.89 billion. This decline is primarily due to reduced foreign investor activity, as capital has flowed out of emerging markets towards more developed economies. This shift is linked to rising interest rates in developed countries, aimed at combating inflation exacerbated by supply chain disruptions from the Russia-Ukraine conflict and post-COVID-19 economic recovery.

Foreign Investors

Foreign investors’ participation in the DSE showed mixed results in 2023. On the buying side, foreign turnover increased significantly by 80.7%, reaching TZS 118.95 billion. Conversely, on the selling side, foreign turnover rose even more sharply by 132.4%, totaling TZS 147.43 billion. Analysts stress that these figures are somewhat skewed by the large-scale acquisition of Tanga Cement Company Limited. Excluding this transaction, foreign investor participation saw a decline of 80.7% in buying and 35% in selling, resulting in values of TZS 12.70 billion and TZS 41.17 billion, respectively.

Local Investors

Local investor participation saw considerable growth in 2023. The value of equities purchased by local investors increased by 56.1%, rising from TZS 68.07 billion in 2022 to TZS 106.27 billion in 2023. Additionally, the value of equities sold by local investors grew by 10.3%, from TZS 70.48 billion in 2022 to TZS 77.80 billion in 2023. This upsurge can be attributed to enhanced efforts by capital market players to attract institutional investors such as pension funds, mutual funds, and insurance companies.

Market Capitalization

In 2023, the Dar es Salaam Stock Exchange (DSE) experienced a decline in total market capitalization, which ended the year at TZS 14.61 trillion. This marks a decrease of -6.8% from TZS 15.68 trillion recorded at the end of 2022.

The All Share Index (DSEI) which tracks the performance of all publicly traded companies at DSE, closed at 1,750.63 points as of December 2023, down -6.9% from 1,881.99 points the previous year. Analysts attribute the drop to the turmoil in the Nairobi Securities Exchange, where the Nairobi All Share Index plummeted by -27.7%, from 127.47 points on December 30, 2022, to 92.11 points on December 29, 2023.

The Nairobi market’s struggles were driven by foreign capital outflows and local investors’ challenges, including higher living costs, which hindered their ability to capitalize on market opportunities. Consequently, high-value cross-listed companies like KCB Bank Group (DSE: KCB), Jubilee Insurance Holdings (DSE: JHL), and East African Breweries Limited (EABL) faced significant capital losses, contributing to the downward trend in both the Total Market Capitalization and the DSEI.

Local Market Performance

Despite the overall market downturn, the local market has shown robust performance. Both the Local Market Capitalization and the Tanzanian Share Index saw positive growth. The Local Market Capitalization increased by 10.8%, rising from TZS 10.28 trillion at the end of 2022 to TZS 11.40 trillion as of December 29, 2023. Similarly, the Tanzanian Share Index (TSI) which tracks the performance of the top-performing companies listed on the DSE, surged by 10.6%, climbing from 3,888.81 points to 4,304.40 points over the same period.

This growth is attributed to strong performances by key local companies such as NMB Bank (DSE: NMB), CRDB Bank (DSE: CRDB), and Tanzania Portland Cement (DSE: TPCC). These companies have benefited from solid fundamentals, increased profitability, and favorable dividend payments. Positive investor sentiment and improved economic conditions have enabled these local firms to capitalize on market opportunities effectively.

How to Invest at DSE

Investors can trade a variety of securities on the DSE, including:

• Equities: Shares of publicly listed companies.
• Bonds: Government and corporate bonds.

The minimum number of shares one can buy is 10 shares, and bonds are sold at a multiple of TZS 100,000.

Non-Tanzanian investors have no limitations on the stocks and amounts they wish to buy, but government securities (bonds) are only available to East African Community (EAC) residents up to 40% of the amounts issued.

How to Trade on the DSE

Trading at the DSE is conducted through an automated system that matches buy and sell orders. This electronic trading platform enhances efficiency and transparency in transactions.

The DSE operates from Monday to Friday, from 8.00 a.m. to 5.00 p.m. Trading activities start at 10.30 a.m. and close at 04.00 p.m.

Steps to Start Trading

1.Open a Brokerage Account: Investors must open an account with a licensed brokerage firm.

2.Deposit Funds: Transfer funds into the brokerage account.

3.Place Orders: Submit buy or sell orders through the brokerage firm or via the DSE Mobile Trading Platform or App: https://onlinetrading.dse.co.tz

For more information, visit the Dar es Salaam Stock Exchange website at DSE Website, email info@dse.co.tz, or call +255 22 212 3983 or +255 22 212 8522.

Last updated: 13th January 2025