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Rain’s R18 billion valuation


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Rain’s R18 billion valuation

African Rainbow Capital (Arc) Investments has released its half-year financial results and announced that it had maintained its 20.25% shareholding of Rain at a R3.635 billion valuation.

Dividing the valuation by Arc’s shareholding shows that the company believes Rain is worth R17.951 billion.

For context, Telkom’s market capitalisation stood at R17.61 billion at publication time.

Arc’s investment in Rain comprises 26.6% of the fund value.

“The industry has been affected by the ongoing load-shedding and battery theft which led to a corresponding increased cost,” Arc stated.

It said this is expected to remain a challenge in the short term.

“Demand has however remained robust and Rain continued to deliver well on both 4G and 5G sales during the period,” said Arc.

It also said Rain is already delivering strong profits and expects this to continue accelerating if current trends persist.

“Rain is on course to achieve an EBITDA of over R2 billion for the year ended February 2023, after considering IFRS 16 adjustments as is industry practice.”

Rain valuation

The table below provides an overview of Arc’s shareholding value and Rain’s total valuation between December 2017 and June 2022.

Rain valuation by Arc
Date Arc shareholding in Rain Arc’s shareholding value Rain’s valuation
December 2017 20.0% R1.892 billion R9.460 billion
June 2018 20.0% R2.114 billion R10.570 billion
December 2018 20.0% R2.330 billion R11.650 billion
June 2019 20.6% R2.508 billion R12.175 billion
December 2019 20.7% R2.712 billion R13.101 billion
June 2020 20.7% R3.111 billion R15.029 billion
December 2020 20.37% R3.493 billion R17.148 billion
June 2021 20.26% R3.314 billion R16.357 billion
December 2021 20.26% R3.372 billion R16.644 billion
June 2022 20.25% R3.635 billion R17.951 billion
December 2022 20.25% R3.635 billion R17.951 billion

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