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Shares in MultiChoice [JSE:MSG] rose by 15.5% in early trade on Wednesday after the entertainment company listed on the Johannesburg stock Exchange.
Shares started trading at R95.50 on Wednesday, and were changing hands at R110.27 just before noon.
With just over 438 million shares at issue, the company had a mid-morning market capitalisation of R48.5bn. This makes it roughly the same size as a company like Tiger Brands, South Africa’s biggest food producer.
This would also put it in the Top-50 JSE-listed firms by market capitalisation.
“We are happy with where the share opened and how it is trading,” MultiChoice Chief Financial Officer Tim Jacobs told Bloomberg in an interview at the JSE. “We expect it to settle down in the next three months.
“We have identified about 40 million additional subscribers that could be signed on in the middle income and mass market,” Jacobs said. About half the company’s current customer base is in South Africa, and the focus after listing will be to accelerate growth on the rest of the continent, he said.
Musa Makoni, trading specialist at Purple Group told Fin24 on Wednesday that, as expected, there was quite a bit of volatility when the shares started trading, but by late morning this seemed to have stabilised.
"For now it is still early days and it would be a gamble to make a call on where it is heading. With any listing, you will get euphoria at the beginning," said Makoni.
MultiChoice was previously part of Naspers and unbundled from its parent company in September 2018.
Brands that fall under the MultiChoice umbrella include SuperSport, DStv, GOtv, M-Net, Showmax and digital protection company Irdeto.
Calvo Mawela, MultiCoice Group CEO, said in a statement on Wednesday that the company was well positioned to generate shareholder returns and future growth.
"We are overwhelmingly positive about MultiChoice Group’s future. With the largest pay-TV footprint across Africa, we understand our customers and tailor our offering and services to suit market-specific video entertainment needs."
Shares in Naspers [JSE:NPN], meanwhile, were down -3.63% at noon at R3 028.00.
* Fin24 is part of Media24, a subsidiary of Naspers
