(Ecofin Agency) - The institution will highlight the attractive returns from its portfolio, which includes shares of listed companies and a diverse range of bonds. While some companies on the market are already well-known, BRVM leaders will need to address a few concerns.

The Regional Stock Exchange (BRVM), which operates in the West African Economic and Monetary Union (WAEMU), is currently in London, UK, as part of a tour aimed at meeting investors and presenting investment opportunities in the region.

Unlike foreign direct investments in new projects or existing companies, portfolio investments involve acquiring shares in listed companies or bonds issued by businesses or governments. In this context, BRVM's leadership has focused on the dynamics of these financial products in 2024.

“BRVM has experienced a second consecutive year of growth and solidified its position as the fifth-largest stock exchange in Africa. The positive growth of our total market capitalization has strengthened BRVM’s role in the regional economy, now representing around 15.12% of GDP, up from 9.17% in 2012,” said Edoh Kossi Amenounvé, the CEO of BRVM. He added, “In fact, BRVM offers returns of over 8% in the stock market and around 6% on average in the bond market.”

2025 has just begun, and the first results for 2024, along with the dividends that will follow, are expected to come in gradually. For 2023, the total value of dividends already announced by the end of July 2024 was estimated at CFA613.16 billion, according to calculations by Ecofin Agency, based on data from the Richebourse platform. This figure had exceeded the historic threshold of $1 billion.

This level of shareholder payouts reflects a general trend among companies to distribute more of their net margins, which reached a historical value of CFA1044.12 billion ($1.72 billion). In fact, for the first time since 2020, the share of distributed profits represented 58.73% of the total reported (excluding those from the Ecobank group, which were not included in the analysis).

The bond market is just as robust, valued at $17 billion as of the close of trading on February 26, 2025. It includes a range of securities, such as those issued by governments, regional entities, and Islamic-compliant bonds. The meetings with investors in London are part of the traditional “BRVM Investment Days,” with this edition by invitation only.

BRVM has several key factors to attract international portfolio investors. Its transaction currency, the CFA franc, is stable and freely convertible, backed by the euro, a strong currency. Current returns, measured by dividend value compared to stock prices, are at 8.52%, while stock values have seen an average increase of 9.73%.

Some of its listed companies are already well known to international investors, such as Sonatel, which attracts the most foreign investment funds outside the WAEMU. Other examples include Ecobank Transnational Incorporated, although most of these investments are made on the Lagos Stock Exchange. Companies like Société Ivoirienne de Banques, Société Générale Côte d'Ivoire, and Orange Côte d'Ivoire are also part of several investment portfolios.

However, despite BRVM's attractive returns and its position as the fifth-largest African stock exchange, it faces strong competition from older, well-established exchanges in Egypt, Morocco, Kenya, and Nigeria within the ECOWAS region.

In addition to their long history, these exchanges benefit from greater transparency, with companies regularly updating their financial communications in the most detailed manner. Despite BRVM's management efforts, the volume and quality of information from listed companies still need improvement. Furthermore, the WAEMU financial market has become a safe haven for local investors, leading to a slight overvaluation of the market compared to the underlying performance of its companies.

As of February 26, 2025, the average Price-to-Earnings (P/E) ratio, which indicates how many years of earnings are needed to repay the investment made in a stock, was 11.45. This means it takes roughly 12 years to recover the investment, which could attract speculative investors looking for short-term returns. On the bond side, foreign investors will focus on the subregion's ability to manage pressure on foreign exchange reserves to ensure opportunities to buy or sell at any time.

Writing by Idriss Linge; Editing by Vahid Codjia; Translation from French by Firmine AIZAN