Vodacom – Leading African Communications Company

Vodacom is a leading African communications company that serves over 103 million customers with a wide range of communication services such as mobile voice, messaging, data, financial, and converged services.

Vodacom’s mobile network business has expanded beyond its South African roots to include operations in Tanzania, the Democratic Republic of the Congo, Mozambique, Kenya and Lesotho.

About Vodacom

Vodacom Group Limited is a holding company for investments.

The Company is a mobile communication company that offers a variety of communications products and services such as voice, messaging, converged services, broadband, and data connectivity.

South Africa, International, and Corporate are the Company’s segments. The South Africa segment includes information about cellular networks, service providers, and other business segments based in South Africa.

The International segment includes information about non-South African cellular networks in Tanzania, Mozambique, Lesotho, and the Democratic Republic of the Congo, as well as Vodacom International Limited and Vodacom Business Africa operations (VBA).

VBA is used by the company to provide business managed services. Over 61 million customers use the company’s services. Vodafone Group Plc ultimately controls the company.

Vodacom has a primary listing as JSE: VOD.

Vodacom

Image Source: Игорь Головнёв – stock.adobe.com

Vodacom Investments

Vodacom’s latest trading update revealed it spent R 2.7billion on its network over the last three months.

The group anticipates that demand for mobile data will continue to rise sharply as smart devices become more widely available, and it is increasing network investment to capitalize on this future demand.

Vodacom aims to cement its position as one of Africa’s leading companies and grow the Vodacom share price by increasing the contribution of international operations, expanding enterprise offerings, and keeping up with new technology such as fiber internet and other services such as M-Pesa, insurance, and the Internet of Things.

Here are some of the key investments of the Vodacom group.

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1. Safaricom

Safaricom PLC is a publicly-traded Kenyan mobile network operator headquartered in Nairobi, Kenya. It is Kenya’s largest telecommunications provider and one of the most profitable companies in East and Central Africa.

The company offers integrated telecommunications services such as mobile and fixed voice, short messaging service (SMS), data, Internet, and M-PESA, a service that allows you to send and receive money as well as pay for goods and services using your mobile phone. It also offers financial services and enterprise solutions to businesses and government agencies.

2. Neotel

Neotel, formerly SNO Telecommunications, is South Africa’s second national operator (SNO) for fixed-line telecommunications services. The company offers telecommunications, telephony, voice, data, and internet services to businesses, wholesale network operators, network providers, and consumers via an IP network powered by a high-performance fiber-optic backbone.

Between 2009 and 2011, Neotel was involved in a number of submarine communications cables that increased South Africa’s international connectivity as a wholesale telecommunications provider and to support its own services.

3. M-Pesa

Safaricom and Vodacom operate M-Pesa. Lots of users who have a mobile phone but no or limited access to a bank account can use the company’s services, which provide a safe, secure, and affordable way to send and receive money, top-up airtime, make bill payments, receive salaries, get a short-term loan, and much more.

4. Iot-Nxt

Businesses can use an IoT solution to create a digital overview of their entire organisation, including old and new technology, equipment, and processes, and gain insight from the data.

Based in Centurion, South Africa, the developer of an IoT software platform designed to increase work efficiencies and reduce costs. The company’s IoT software platform entails risk management, the improvement of existing products and services, and serves as the foundation for future-proofing organisational digital transformation.

5. Gateway Telecommunications

Gateway Telecommunications SA provides communications services to telephone operators, hotels, and corporations in Africa and internationally. It offers spectrum solutions based on satellite, submarine cable, and terrestrial fiber. The company offers voice, data, and management support and consulting services for service providers; network and electronic commerce services for businesses; and network management, connectivity, cellular backhaul, Internet connectivity, multiprotocol label switching VPN, and eCommerce services.

Vodacom business strategy

Vodacom’s overall marketing strategy is centred on the vision of becoming a leading digital company that puts the customer first. Vodacom intends to use big data and IoT to better serve its customers and lead them into a future as the world evolves along with technology.

Vodacom places a high priority on digital innovation in order to improve its products and services, and thus its customer experience. For example, when their 39 million customers contact a call centre, they use predictive analytics to manage them.

Predictive analytics allows them to learn more about the customers who call and saves time that would otherwise be spent trying to gather information about customers.

Vodacom IPO

Vodacom listed its IPO on JSE in 2009. The group’s major shareholders are: Vodafone Group, SA Government, Public Investment Corporation.

Vodafone has a majority share in Vodacom (64.5% holding). Vodafone is one of the world’s largest communications companies by revenue.

In 2017, Vodacom Tanzania IPO was opened to foreigners. It offered 560 million shares to the public at 850 Tanzanian shillings (R4.99) per share. In 2000 Vodacom launched its IPO, and currently, it is the group’s second-biggest market.

Vodacom stock analysis

Vodacom Group Ltd (VOD) is currently trading at ZAR 129.57 per share. The VOD stock closed its last trading day on the Johannesburg Stock Exchange at 129.57 ZAR per share, representing a 1.92 percent increase over its previous closing price of 127.13 ZAR. VOD started the year with a share price of 124.39 ZAR and has since gained 4.16 percent on that price.

The current trend is strongly bullish, and as the telecommunication sector is thriving in South Africa, investors can take advantage of it.

Bottom line

The telecommunication sector has huge growth potential in South Africa, and Vodacom is the household name. Vodacom provides an attractive investment opportunity, which also drives inclusive growth in the South African economy. Though Vodacom provides good overall investment opportunities, investors need to study the overall market before investing in Vodacom.

Categories: Stock Market Trading | Author: Jason Morgan | Date: 10 January 2022

Jason Morgan

Jason Morgan is an experienced forex analyst and writer with a deep understanding of the financial markets. With over 15+ years of industry experience, he has honed his skills in analyzing and forecasting currency movements, providing valuable insights to traders and investors.

Forex Content Writer | Market Analyst

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