Vumatel and DFA’s impressive valuation

Remgro recently released its financial results for the year ended 30 June 2020, which revealed that Community Investment Ventures Holdings (CIVH) is valued at R18.5 billion.

What makes this valuation interesting is that it is higher than Telkom’s current market cap of R12.6 billion.

CIVH is focussed on the telecommunications and IT sectors, and its key operating companies are Vumatel and Dark Fibre Africa (DFA).

Through Vumatel and DFA, CIVH has a strong position in the South African business and residential fibre markets.

Vumatel and DFA are working in tandem to provide fibre access to South African businesses and homes.

Their fibre rollout in recent years is impressive. Vumatel and DFA’s 29,300km fibre network scales across all key metros in South Africa.

It passes 690,000 premises and connects 11,500 mobile base stations and 240,000 homes and businesses.

DFA owns fibre networks in Johannesburg, Cape Town, Durban, Midrand, and Pretoria, as well as in smaller metros like East London, Polokwane, Tlokwe, Emalahleni, and George.

These valuable fibre assets and the strong annuity revenue growth have made CIVH one of Remgro’s key growth drivers.

While CIVH recorded a loss of over R1 billion in the last financial year – mainly due to transaction and funding costs related to the Vumatel acquisition – DFA and Vumatel performed well financially.

DFA’s revenue increased by 5.0%, as its annuity income grew to over R179 million per month on 31 March 2020.

Vumatel’s revenue increased by 80.0% to R1.5 billion compared to the prior year, driven by accumulated subscriber uptake growth.

Telecoms company valuations

CIVH’s R18.5-billion valuation places it among some of South Africa’s most valuable telecommunications companies.

Vodacom is South Africa’s most valuable company at R226 billion, followed by MTN at R105 billion, and then CIVH at R18.5 billion.

The table below provides an overview of the current valuations and market caps of South African telecoms companies.

South African Telecoms Companies
Company Measure Market Cap/Valuation
Vodacom JSE market cap R226 billion
MTN JSE market cap R105 billion
CIVH Remgro valuation R18.5 billion
Rain ARC valuation R15.0 billion
Telkom JSE market cap R12.6 billion
Cell C Blue Label valuation R0

Now read: Rain’s extraordinary valuation

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Vumatel and DFA’s impressive valuation