🇿🇦 Mzansi Market Memo — Wednesday, 23 July 2025

Moloweni gents and gentleladies.

The JSE kicked off the week with its running shoes on, but took a step back yesterday. Today we’ve got more than just numbers — we’ve got high-stakes drilling in Namibia, infrastructure loans the size of a BRICS summit, and luxury firms proving that scarcity still sells.

Meanwhile, Joburg’s crumbling and policy voices are growing louder. Whether you're watching Sasol’s bounce-back or bracing for tariff tremors, this week has something for every side of your portfolio.

Let’s get to the money.

⚡ Before the Bell

• 🌍 Global & Local Market Recap

  • JSE All Share Index: down 0.33% - don’t tease me more!

  • USD/ZAR Exchange Rate: R17.57 - big move

• Stats SA today: CPI releases 10:00

• Earnings today: 

  • AGMs: Ninety One Ltd (1L) & Plc (1); Afrimat

  • Kumba – Interim Results.

📣 SENS Roundup

1. 🔋 Sasol (SOL)
   📊 Trading update shows strong EPS rebound
   Sasol expects EPS to rise more than 20% year-on-year, recovering from a prior loss driven by impairments. Operationally, the group reported improved gasifier performance, a R4.3bn legal settlement with Transnet, and progress on renewables and digital transformation. But tariff risks and international pricing pressure remain.
   TLDR: Sasol's self-help plan is gaining traction — earnings bounce back, but risks still hang in the air.

2. 🛣️ SANRAL
   💸 R7 billion loan secured from New Development Bank
   The road agency confirmed it has signed a R7bn facility with the NDB to fund critical transport corridors like the N2/N3 and N1. The remaining borrowing limit will be used to raise more domestic funding.
   TLDR: Long-overdue capital now flowing into national infrastructure — good news for SA logistics and construction sectors.

3. 🏢 Deutsche Konsum REIT (DKR)
   ⚠️ Tax-exempt REIT status in danger
   The German-listed property firm (also listed on the JSE) expects a €41m impairment on its property portfolio and is set to lose its tax exemption due to equity ratio breaches. It is now seeking creditor approval for a capital raise.
   TLDR: Investors in offshore REITs, watch this one — impairments and tax changes could ripple across the share price.

4. 📊 Datatec (DTC)
   💸 Dividend results: R265m cash, R206m in new shares
   Datatec paid out R265 million in cash dividends while issuing 3.3 million shares via the scrip alternative — reflecting decent shareholder take-up.
   TLDR: Classic split — a sign that many investors still like cash in hand amid rate uncertainty.

5. 🌍 Reinet Investments (RNI)
   📉 NAV drops, big disposal underway
   The Luxembourg-listed fund reported a 4.6% NAV drop in Q1 but confirmed it will sell its full stake in Pension Insurance Corporation to Athora. Dividends received from the same asset exceeded €200 million this quarter.
   TLDR: Cash is coming in, but valuation pressures are showing — Reinet’s repositioning will be one to watch.

6. 🛢️ ReconAfrica (RECO)
   ⛏️ Drilling set to begin on massive Namibian play
   Final checks are complete ahead of spudding the Kavango West 1X well. It’s the second test in a high-stakes, high-reward Damara Fold Belt region.
   TLDR: This could be a game-changer for the explorer if the drill hits — one for the speculators’ watchlist.

🧠 Exec Picks - tariffs and tariffs

1. Luxury firms are printing money — if you pick the right one
   👜 Think handbags over hedge funds. Brands like Hermès and Ferrari are riding their scarcity moats to 200%+ five-year returns, while others like Gucci have cratered. The lesson? Pricing power and heritage are everything. Investors are reminded that luxury stocks are part business, part psychology — and part art.
   TLDR: Luxury isn’t just a lifestyle — it’s an investment category with moats, mystique, and monster margins. But beware: brand love doesn’t always equal shareholder love.
   Read more: Currency News

2. Johannesburg is South Africa’s richest city — and it’s falling apart
   🏙️ Daily Investor reports that Joburg is facing escalating service delivery failures, collapsing infrastructure, and governance chaos. From potholes to power failures, the economic engine of the country is sputtering while property values suffer and ratepayers revolt.
   TLDR: If Jozi goes down, the economy feels it. Urban decay is no longer just a local problem — it’s a macroeconomic risk.

   Read More: Daily Investor

3. Sanral secures R7bn BRICS loan to fix critical roads
   🚧 South Africa’s roads agency has clinched a R7 billion loan from the New Development Bank to finance upgrades along key corridors like the N2 and N3. This is one of the largest BRICS-backed transport deals yet and aims to unblock logistics bottlenecks.
   TLDR: Long-overdue infrastructure upgrades get a BRICS-sized boost. Expect spend — and scrutiny — to ramp up fast.
   Read more: Business Report

🧾 Glossary: Market Moves Explained

When the jargon hits harder than a load shedding schedule, we’ve got you. Here’s your quick decode of today’s financial buzzwords.

• Gasifier – A high-temperature unit used to convert carbon-based materials like coal into gas for fuel or electricity. Crucial to Sasol’s synthetic fuel operations.

• Scrip alternative – A dividend payment option where shareholders can choose to receive shares instead of cash. It’s a way for companies to preserve cash while still rewarding investors.

• Equity ratio breach – When a company’s equity (or capital base) falls below a set threshold, often triggering regulatory or tax consequences — like loss of REIT status.

• NAV (Net Asset Value) – A fund’s total assets minus liabilities. A falling NAV signals deteriorating portfolio value or large distributions.

• Spudding – Industry jargon for starting to drill a new oil or gas well. It marks the official beginning of a drilling project.

• Scarcity moat – A competitive advantage where limited supply (like exclusive handbags or limited-edition sports cars) keeps demand — and prices — high.

• Urban decay – The breakdown of city infrastructure and services, often marked by potholes, power failures, failing governance, and declining property values.

😂 Meme of the Day

🧾 Final Word

Markets may be rising, but so are questions — about governance, infrastructure, investor trust, and whether policy will finally shift toward growth. From BRICS-funded roads to luxury margins to PIC’s quiet gold bets, it’s all a reminder: capital flows where confidence goes.

Stay curious, stay early, and as always — trade smart, lead sharp.

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Mzansi Market Memo is compiled daily by Rayhaan @ the Memo for investors and operators who trade before the sun rises. *This memo is for informational purposes only. Not financial advice. Still, we’d buy low and read high.

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