Brainworks Limited. JSE: BWZ

Brainworks

Background of Brainworks

  • Brainworks is an investment holding company with a portfolio of hospitality, financial services, real estate and logistics assets in Zimbabwe. The company became the first Zimbabwean company to have shares listed for sale on the Johannesburg Stock Exchange (JSE) in October 2017.

  • The group owns seven resort hotels and four city hotels, and has controlling stakes in two Zimbabwe Stock Exchange-listed companies: hospitality management company African sun and real estate company Dawn Properties.

  • Brainworks shares were listed for purchase at R11.50 per share, with the goal of raising approximately R317 million capital. Today, Brainworks has a JSE market cap of R766 million.

Brainworks Shares Growth Driver

  • Before listing in South Africa, Brainworks had enjoyed a solid history of growth. The group’s latest financial data, covering the first six months of 2017, showed that revenue grew by 23% to US$24.22 million, thanks to growth across its three main operating segments.

  • There has been particularly good growth in the hospitality segment, which contributes 87% of the group’s total revenues. Revenue in this segment jumped by 17%, largely thanks to an increase in occupancy rates, from 37% to 45%. Solid performance was achieved from local, international and regional occupancies. The upgraded Victoria Falls International airport has had a positive impact on improving tourist numbers and occupancy rates.

  • Overall, however, the group struggled with profitability, posting a loss of $4.87 million. This was mainly due to once off expenses, fair value losses on listed equity investments and an impairment allowance of $0.92 million. This is in line with the historical trend of incurring losses during the first half of the year, as the peak season of principle business activity occurs in the second half of the year. Improvements are therefore expected to be reflected in the group’s next financial results, to the benefit of Brainworks share price.

  • The main obstacles which Brainworks has had to overcome to drive growth include the difficult macro-economic environment in Zimbabwe, evidenced by subdued foreign investment, low liquidity and constrained foreign currency reserves. The strength of the US dollar also resulted in subdued tourist arrivals from South Africa, the group’s key regional source market.

  • Brainworks has also sought to diversify through investment in property, micro-finance, insurance and banking. Going forward, key activities for the company will include the development of a facility with the Reserve Bank of Zimbabwe, allowing Zimbabwean investors to buy Brainworks shares without the need to source for foreign currency. The group aims to acquire a secondary listing on the Zimbabwe Stock Exchange.

Brainworks Group Investor Tip

  • Zimbabwe’s continuing economic crisis represents a major challenge for Brainworks, but fortunately the company is operating mainly within the relatively stable hospitality segment. The live online stocks chart has yet to reflect growth in Brainworks share price, and investor response to the shares is difficult to forecast. Although Brainworks’ underlying businesses look fairly resilient, many would view this as a risky share to buy, considering the present state of Zimbabwe.

Brainworks Major Shareholders

No Available

  • Sector

    Real Estate

  • Industry

    Hospitality

  • Sub industry

    Resorts and Hotels

How to buy Brainworks Group Shares

  • Brainworks : How to buy Brainworks Group Shares Online

    We have made it simple to buy JSE listed firm shares online. The easiest way to buy Brainworks shares or stocks is to; start by submitting the ‘BUY THIS SHARE’ form. Next, one of our experienced and certified stock brokers will personally get in contact with you to discuss your custom stock request. Finally, a stock advisor will confirm the amount of shares you are looking to invest in Brainworks and assist you with the setup and management of your stock portfolio account.

  • Here are the steps you must follow to Buy / Purchase Brainworks Group shares with utmost confidence:

    1. Start by Filling in the BUY THIS SHARE form.
    2. Insert your name, email, telephone number and monthly remuneration.
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    4. Click the “ INVEST NOW” button
    5. Once we have received your info, a dedicated stock advisor will personally call you back to discuss your personal share request.
    6. Lastly, your newly appointed personal stock advisor will handle all account setups and reporting as stipulated by the financial services board of South Africa (FSB)
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