These 20 SA stocks might benefit from a solid ANC victory

SA’s benchmark index dropped 0.4% as of 2.49pm in Johannesburg on Monday, trimming its advance this year to 11%.

Here are some of UBS’s preferred SA stocks in the lead up to the election, detailed in an April 16 report co-authored by Pillay:

Here are some of UBS’s preferred South African stocks in the lead up to the election, detailed in an April 16 report co-authored by Pillay:

Banks: Absa, Capitec Bank, FirstRand, Standard Bank. “Expect lower yield environment and lower cost of equity to support performance for local banks. Banks should also benefit from improvement in consumer sentiment and growth outlook. Policy clarity could provide additional driver for corporate borrowing and investment”

Insurers: Discovery, Old Mutual and Sanlam. To benefit from the “lower-yield environment, improved consumer sentiment and strong market performance”

Industrials and telcos: Bidvest should benefit from a resumption of government contracts, with improved growth outlook supporting logistics business. Multichoice is seen benefiting from improved domestic consumer sentiment and growth outlook. Vodacom is most exposed to the SA consumer, with attractive valuations

Retail sector: Pick n Pay, Shoprite, Truworths, Mr Price, Clicks and TFG to benefit from improved consumer sentiment and growth prospects; sector has de-rated and is looking attractive relative to history. “Strong rand should help lower input inflation and support margins”

Food producers: Tiger Brands and AVI’s strong gearing to the local consumer should support the sector on improved consumer sentiment. “Expect to see additional benefit from currency strength and lower input costs.”

Property: Redefine Properties and GrowthPoint Properties. Lower yields and a stronger rand should support share price performance in the short term; longer term benefit from improvements in demand for property space

With Renee Bonorchis.

Bloomberg