Macro Analysis /

Zimbabwe Mining Sector

  • Mining firms deferred capital expenditure and slowed project activity in 2020, but have since reversed the trend

  • The pandemic brought with it an increase in shipping and container costs

  • Investors are increasingly looking at ESG performance & ratings as an indicator for good management and risk mitigation

Tatenda Makoni
Tatenda Makoni

Equity Sales Trader

IH Securities
19 July 2022
Published byIH Securities

Optimism for 2022 in the sector remains encouraged by ongoing developments in increasing capacity and the outlook on commodity prices. According to government estimates, production growth is expected to come in at 8% in 2022. Capital constraints and policy shifts remain the main downside risks for the sector. Beneficiation remains a key issue hindering earnings growth.

From a stock market perspective, we remain in favour of companies with strong financial positions that give room for investment in output growth during a season of high commodity prices and also provide a cushion to ride out rockier periods for the underlying commodities. We're attracted to companies with a culture of management execution, transparency and creation of value for shareholders.

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