Nampak Ltd., South Africa’s largest packaging company, climbed to a record after saying it is evaluating projects worth $498 million in Africa in the next three to five years to tap into faster-growing economies.
Shares advanced 3 percent, the most since July 5, to 28.99 rand by the close in Johannesburg, the highest since at least 1990 when Bloomberg started compiling data on the stock.
The company is considering projects worth a total of $350 million in West Africa as well as $120 million in Angola and Mozambique, according to a presentation to investors in Cape Town yesterday posted on its website. Nampak is also planning projects worth a further $28 million, including in East and Southern Africa.
“It looks like investors are buying into the rest-of-Africa strategy, although it still has some way to go,” Mark Hodgson, an analyst with Avior Research (Pty) Ltd., said by phone from Cape Town. “They put across a good message in terms of what they are trying to do.”
Angola and Nigeria are the main focus for the company’s investments outside South Africa, Graham Hayward, head of investor relations, said by phone from Johannesburg.
The Johannesburg-based company plans to double earnings from businesses elsewhere on the continent to 16 percent this financial year, Chief Executive Officer Andrew Marshall said in a Feb. 1 interview. It increased revenue from the rest of Africa to 1.3 billion rand ($155 million) in the year through September 2011 from 1.2 billion rand a year earlier.
Nigeria’s economy expanded 6.6 percent in the second quarter, more than twice South Africa’s 3 percent growth over the same period. The International Monetary Fund expects Angola’s economy to expand 6.8 percent this year.