Business 7 May 2026 Daily Monitor (Uganda)
MTN Uganda: From Ignored IPO to Star Investment
MTN Uganda's stock has seen a remarkable turnaround since its 2021 Initial Public Offering, rewarding patient investors with significant capital gains and substantial dividends despite initial skepticism and undersubscription. Source: https://www.monitor.co.ug/uganda/business/markets/mtn-the-investment-many-ignored-then-scrambled-for-5450778
When MTN Uganda listed on the Uganda Securities Exchange (USE) in 2021, the response was lukewarm, a stark contrast to its current dominance.
The initial public offering (IPO) faced an undersubscription, with Ugandans only taking up about 65 percent of the shares offered. Many investors were hesitant, citing a lack of knowledge, fear of losing money, and general distrust in the stock market, which had historically struggled to attract significant interest.
However, those who did invest found their patience rewarded. Early investors benefited from incentive shares, effectively receiving a discount on their purchase. Furthermore, MTN has consistently paid out substantial dividends, amounting to Shs864.4 billion between its IPO and mid-2024. For a Shs1 million investment at IPO, cumulative dividends alone returned over Shs400,000.
The market’s perception began to shift, especially after a 2024 secondary share offer, which was oversubscribed, signaling renewed confidence. This led to a surge in MTN’s share price, which has gained 111 percent since the IPO.
MTN now stands as the most valuable stock on the USE, accounting for a significant portion of the market’s capitalization. Its performance has outperformed traditional investments like treasury bonds, offering an estimated internal rate of return of 17.4 percent per annum.
The telecom giant’s journey highlights the importance of patience in investing and suggests that regulatory nudges can foster public participation in the stock market. Despite the growth in savings, a significant portion of Ugandan investments still resides in safer, more familiar government bonds, indicating potential for further stock market expansion.
Excitement also surrounds potential corporate actions, such as the separation of its mobile money business, which could further unlock shareholder value. As other telcos like Lycamobile and Airtel prepare to list or offer shares, the Ugandan stock market is experiencing a dynamic period.
Source: Daily Monitor (Uganda)