Johannesburg - At the height of Zimbabwe's hyperinflation, restaurant prices would increase in the time it took to serve and eat a meal.
Those days are gone and some bold investors are now betting on growth in the troubled nation, while keeping alert to the high political risk.
"Zimbabwe we like. Obviously we sleep with one eye open due to the unresolved political situation there," Thabo Ncalo, portfolio manager of Stanlib's $300m African equities fund, told Reuters last week.
"I don't think anyone wants to get back to that period of economic turmoil in Zimbabwe. I hope the political leadership will be smart enough not to take people back to that type of inflationary environment."
Zimbabwe stocks have outperformed others in Africa. Stanlib's Africa fund is 10% invested in Zimbabwe, where the dollar-denominated benchmark Industrial index is down 5% in the 10 months to end-October.
In comparison, Nigeria's All-Share index is down more than 17% so far this year in dollar terms, while Kenya's NSE 20 has plunged 21%.
In 2009, the government abandoned a local currency rendered worthless by hyperinflation - which reached 500 billion percent at the peak of its economic and political crisis - to adopt multiple foreign currencies that helped stem the decline.
Inflation has since returned to single digits and the economy is in recovery, but investors remain wary of President Robert Mugabe
and his controversial policies on land seizures and forced majority ownership of local units of foreign firms.
The dollarisation of Zimbabwe's economy is one less thing to worry about for foreigners investing there.
Zimbabwe's best performer is Fidelity Life, up 559% for the year to date, and TN Holdings, with a 337% gain. The worst performers are Star Africa, down 82.9%, and Gulliver, down 76.2%.
Top picks for Stanlib at Harare's bourse are Delta Corporation, a unit of global brewer SABMiller [JSE:SAB]
, and Econet Wireless, the country's largest cellphone operator.
"It is the cheapest telco in Africa with some of the largest growth prospects," Ncalo said. "All the telcos in Africa are actually going ex-growth but Econet is bucking the trend. It is coming from a very low base so it's easy to grow subscribers." Rough ride
Fast food group Innscor is also attractive, especially given its pricing model after the adoption of the US currency.
The lowest dollar value in Zimbabwe is the $1 bill, but Innscor prices meals at amounts requiring change less than a dollar.
With no change for customers, restaurants hand out coupons in lieu of coins. This keeps patrons coming back to claim their coupons, but they end up spending more.
Stanlib has invested nearly a third of its fund - which is down about 16% in the year to end-September - in Nigeria, another 15% in Egypt and 8% each in Kenya and Mauritius.
"It's been a rough ride. We opened at the wrong time, just before the crisis. Luckily, some clients have stayed with us and have adopted the long-term approach needed in investments such as those in African markets."
The fund is investing in banks across the continent. It favours GT Bank, Access Bank, Stanbic IBTC and Zenith Bank in Nigeria.
Stanlib also looks at Kenya's biggest banks by market value, Equity and KCB because of their expansion across the region.
It is also looking at Egypt's National Societe Generale Bank and Commercial International Bank.
Stanlib also participates in London-listed resource firms with operations in Africa, such as mining services firm Capital Drilling.
African markets never recovered when emerging markets started rebounding in 2009, although company earnings on the continent kept growing, Ncalo said.
When big index funds allocate funds to Africa, they actually only invest in South Africa, Morocco and Egypt, he said.
"I think the hype has not been created yet. I am still very bullish, because even during the downturn globally Africa still didn't go into a recession.
"Africa is actually out of favour right now but it will come back, you just have to stick in there."