Ten years ago, Africa seemed like another planet for investors. This is all turning around," says Samir Gadio, emerging markets strategist at Standard Bank based in London. In the past decade, the only market covered with any real enthusiasm in Africa was South Africa, where analysts focused on interpreting the macro and high-beta pictures. But investors are becoming more aware of sub-Saharan Africa as a viable investment destination and are demanding up-to-date and instructive details on the equity markets in the region. Businesses and research houses are recognizing the changing trend. International and local banks operating in the region will have relatively sophisticated research and investor relations departments, but smaller and less well established companies’ investor relations departments remain under-resourced and information is difficult to get.
Over the past five to seven years, the risk perception of Africa has changed dramatically for investors. Although the external environment will always affect company performance and investor interest, research houses highlight the fact that endogenous macro risks have generally become less of a concern than in the 1990s or 1980s.