TELECOMS firm Econet Wireless Zimbabwe (Econet) has begun evaluating potential corporate actions to address what it calls a “grossly undervalued” share price to unlock shareholder value, improve access to capital and strengthen its long-term competitiveness.
According to financial services firm IH Securities, Econet’s share price on the Zimbabwe Stock Exchange (ZSE) had grown 67,85%, year to date, to ZiG 5,5013, equivalent to 21 United States cents as of Wednesday.
Consequently, IH Securities revealed this growth led to a total ZSE market capitalisation of ZiG 18,46 billion equivalent to US$628,31 million.
Meanwhile, the group’s total assets grew in valuation to ZiG 25,61 billion (US$ 957,32 million) as of the end of August, from ZiG11,7 billion (US$ 844,91 million) a year earlier.
In real terms, this translated to a growth of 13,3% over the one-year timeframe.
The figures underscore a clear mismatch between Econet’s market valuation and the underlying value of its business.
While the company’s asset base is approaching US$1 billion, its market capitalisation remains significantly lower at about US$ 628 million — a gap that reinforces Econet’s claim of being “grossly undervalued” on the ZSE.
“In the discharge of its duty to enhance and preserve shareholder value, the Board has observed that the company’s share price on the Zimbabwe Stock Exchange (ZSE) is grossly undervalued in relation to the intrinsic value of the company’s operations and infrastructure assets,” Econet said in a statement.
“This under valuation has restricted the company’s ability to raise competitively priced funding required to sustain further investment in critical network infrastructure and future technology upgrades.”
Econet said this misalignment of the company’s market capitalisation and its intrinsic value had resulted in the erosion of shareholder value, as the company’s market capitalisation does not reflect the growth in business.
“In this regard, the company has commenced the evaluation of potential corporate actions aimed at unlocking shareholder value, improving access to capital, and strengthening the company’s long-term competitiveness (the transaction),” Econet said.
“The outcome of the evaluation process may have a material effect on the price of the company’s securities.”
Accordingly, the telco advised its shareholders and the investing public to exercise caution when dealing in the company’s securities until a further announcement is made.
In the financial year ended February 28, 2025, Econet undertook a major network modernisation programme across 400 sites, replacing obsolete hardware with high-capacity, state-of-the-art equipment.
In its half-year results to August 31, 2025, the telco reported a capital investment-to-revenue ratio of 12%, with spending directed toward strengthening network quality and expanding coverage.
The company said its strategic priorities remain focused on optimising capital investment and accelerating innovation to support sustainable growth and stakeholder
value.
As a result, Econet’s asset base has increased significantly on the back of continued network upgrades and infrastructure expansion. -newsda
