Naspers: JSE history maker

Naspers, the listed Internet and media firm, is eyeing history on the JSE as it marches towards R1,000 per share.

Mof Terreblanche, a director of Stonehage Investment Partners, told Fin24 last week that when Naspers first listed on the JSE, 19 years ago this month (September), it priced at R17.50 per share.

And having closed its first day at R21, Terreblanche said the capitalised value of Naspers amounted to R2.3 billion.

Roll-on to Monday (16 September) and shares in Naspers closed at R940.01, giving the group a market cap of R390.88 billion.

Naspers had hit R948.99 on September 12, thanks in large part to its investments in Internet firm, Tencent. Its share price is up R444.10 rand, or 90%, over the past year alone.

Its success lies in its successful transition from newspaper and magazine publisher, to global Internet and multimedia player through an acquisition strategy, mostly in emerging-market Internet companies, including China’s Tencent and Russia’s Mail.ru.

In its most recent results announcement in June, Naspers pointed to a revenue of R50.2 billion in the year to March, with Internet revenue up 80% to R34.6 billion.

The next frontier in this space is a play in mobile, something CEO Koos Bekker, and chairman, Ton Vosloo have said that the group will target.

“With over one billion smartphones now accounting for 20% of all mobile devices worldwide, internet use is shifting steadily from PC to mobile and tablets,” Vosloo said at a recent AGM.

“In some of our businesses, as much as a third of total traffic now stems from mobile applications. While this trend disrupts existing business models, it also creates opportunities for our talented engineers and committed people in some 130 countries around the globe,” he said.

Analysts believe that that Naspers will breach the landmark figure on the JSE sooner rather than later.

Paul Theron, CEO of Vestact said: “If Tencent keeps going up, Naspers will crest R1,000 soon. That will be a first for a big-cap SA stock.”

“They have a fabulous portfolio of e-commerce and social media assets in emerging markets. Their market cap is only $30 billion, compared to giants like Google (10 times larger) – it’s got lots of space to grow.”

He noted that the group’s TV brand, DStv, continues to reap huge rewards. “For one thing, their sports broadcasting operation is the best in the world,” Theron said.

Nadim Mohamed, an investment analyst and partner at First Avenue Investment Management said: “You have to take your hat off to Koos Bekker and team for the vision to move into the Internet businesses when companies like Tencent were not well known at all.”

“My view is that its more a matter of when they’ll reach R1,000 and not so much if they’ll reach this milestone.”

Mohamed said that, while Nasper’s share has run very hard already in September – meaning that it may come off its levels in the short-term – “longer term, there are so many avenues for growth”.

The analyst pointed to mobile messaging and social networking in China, “which is still at the monetisation stage, as well as the Internet businesses such as Avito which are becoming number 1 or number 2 in their respective markets, and are likely to become profitable in the next 3 to 5 years.”

“It has to be one of the best emerging market Internet properties in the world,” Mohamed said.

Nasper’s principal operations are in Internet platforms, pay-television and the provision of related technologies and print media including publishing, distribution and printing of magazines, newspapers and books.

Locally, it owns online retailers, Kalahari.com and PriceCheck, pay television operation DStv, and Supersport, and Mweb.

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Naspers: JSE history maker