The First African-focused Mutual Fund

Larry Seruma creates the first actively managed mutual fund focusing exclusively on the motherland

The company is looking to capitalize on it in order to expand in other African countries. It owns the largest brewer, for example, in Zimbabwe. And they’re pursuing the same strategy in the rest of Africa. So if you go to Kenya or Uganda or any of these countries, they own some of the largest local brewers. They are looking to use their infrastructure in a way to expand their business. So it has good exposure to Africa, Latin America, and Europe. It’s an African company that has really gone global.

Owning a piece of this company gives an investor exposure to Africa but also other emerging markets. My 12-month price target for SABMiller is $35.

So, we have both commodity and consumer-based picks. Do you have an infrastructure play for us?

Yes. My final pick is MTN Group Ltd. (MTNOY), the largest telecommunications operator in Africa. Based in South Africa, they operate in 21 countries in Africa and the Middle East. Their two largest markets are South Africa and Nigeria.

Their main source of future growth will come from all the untapped markets in Africa. Telecommunications penetration among consumers on the continent is under 15%. That presents an opportunity—a lot of growth possibilities. Another growth opportunity for the company is in the data market. In Africa there is only about 2% penetration in the data market.

Our 12-month price target for this stock is $18.

This article appears in the August 2010 issue of Black Enterprise.

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