An economic analyst has urged Malawians to treat investment in Airtel Malawi as a risk since they can lose money or make a lot.
In a Facebook post on Friday, economic expert Henry Kachaje advised Malawians to analyse the Initial Public Offering (IPO) to see if it’s worth the risk or not saying he has noted that many are making conclusions based on wrong or biased information.
“Some of the analysis in circulation are too subjective. When deciding to invest or not to invest, you need to be as objective as you can.
“Don’t be emotional. Take time to listen and don’t hold to an opinion without first subjecting it to scrutiny,” he posted.
Kachaje also advised people who want to buy the Airtel shares to consult experts saying he has been doing since the offer was made public.
In an earlier post, Kachaje described the Airtel IPO as a good deal.
“I know it’s a good investment opportunity. I have consulted professionals and I have understood what is on offer. I will invest in Airtel,” he said
However, Malawians commenting on the post argued that Airtel is not making profits hence it does not make sense to buy the shares.
“With my poor knowledge of Corporate Finance I can say it’s too risky to buy those shares after reading some of the so called facts. At the moment I just want to read their annual report to confirm my stand,” said one commenter.
Other Facebook users argued that changes in technology could see Airtel failing to make profits in the next 10 years.
“It’s very cheap to text or call a person around the world. Technology is going fast. 5G will take time to come in Malawi but that will make communication cheaper. Just like telephone booth some 15 years ago, so will normal cell phone call be replaced with internet call? Most providers will not make a lot like they used to be,” said Steve Chihana.
Airtel Malawi is selling 2.2 billion shares (20 percent of its shares) to Malawians at a price of K12.69 per share.
Malawians started buying the shares on December 27 and the offer will remain open until January 31, 2020.
The Airtel Initial Public Offer has been described as the largest in the history of the Malawi Stock Exchange.