In case you haven’t heard, MTN Ghana has just launched the biggest IPO in the history of the Ghana Stock Exchange, offering investors GHS3.5 billion (roughly $740 million) worth of shares.
The stock looks like a pretty good deal to me.
At an offer price of GHS0.75 per share, IPO investors will purchase the stock at a P/E ratio of 13.9.
That seems a reasonable price for a company that has captured a 46% share of the market and has grown earnings at an annualized rate of 18.6% since the end of 2013.
MTN Ghana has churned out gobs of cash in each of the past five years and totes a minimal debt load.
Moreover, management expects earnings to grow at a 13.5% clip over the next three years and plans to pay 60% of net profit back to shareholders in the form of an annual dividend.
Sound enticing? If so, here are a few key details to keep in mind when deciding whether to buy a piece of the company.
A Quick Intro to the MTN Ghana IPO
Must you be a Ghanaian citizen to participate in the IPO?
Both Ghanaian and non-Ghanaian investors can apply for shares (except for residents of the United States, Canada, Australia, and Japan).
Note, foreign investors will only be allocated a maximum of 5% of the company’s total shares, and, in the event that investors apply for more shares than the total on offer, Ghanaian applicants will get priority over their foreign counterparts.
What is the minimum amount required to purchase the IPO shares?
Applicants must apply for a minimum of ten shares.
So, at a price of GHS0.75 per share, the minimum amount required is GHS7.50 (roughly $1.60). If you’d like to apply for more shares than that, you must do so in multiples of ten.
How do you apply for shares?
You can apply for shares in one of the following three ways:
- by filling out a physical application form at the office of a licensed Ghanaian stockbroker,
- via the MTN Mobile Money platform, or
- at the IPO website.
Note, if you decide to fill out a physical application at your broker’s office, be sure to bring along identification documentation (driver license, passport, etc.), your bank details, and payment for the number of shares that you’d like to purchase.
How do you apply for shares through the MTN Mobile Money platform?
If you are an MTN Mobile Money subscriber:
- Dial *170#
- Select “MTN GH Share Offer” from the menu.
- Follow the prompts.
Note, the amount due for the shares will be deducted from your mobile wallet.
How do you apply for MTN Ghana shares via the IPO website?
- Visit: https://www.mtnghanashares.com/
- Read and agree to the “Terms and Conditions.”
- Click “Buy” and select “First Time” from the drop down menu.
- Follow the prompts and fill in the requested data on the following pages.
Note, when applying for shares via the IPO website, you must pay by MTN Mobile Money, at a local bank branch, or with a debit card.
When is the IPO application deadline?
The offer closes on 31 July 2018.
When will the shares list on the Ghana Stock Exchange and be available to trade?
The shares will be listed on 5 September 2018.
When will you get your refund if you’re not allocated all the shares that you applied for?
No later than 6 September 2018.
Where can you find a copy of the IPO prospectus?
MTN Ghana IPO Prospectus
What other questions do you have about the MTN Ghana IPO?
Let’s hear them in the comments, and I’ll do my best to get answers for them.
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