Report doesn’t break the bank

It is a mighty peculiar state of affairs when a report from Viceroy Research can all of a sudden be greeted with the widespread panic and alarm that used to be reserved for the arrival of Tomás de Torquemada and a squad of his more imaginative rack artists.

Just the news that this modern-day inquisition had launched a broadside of grape shot at the good ship Capitec was enough for the share price to tank about 25%, before a modicum of sanity returned and it regained much of the losses.

Viceroy’s claim to fame is the report it published on Steinhoff International the day after the company admitted that its accounts were a little optimistic, but apart from that, its claims to credibility appear somewhat obscure.

According to the best the bloodhounds have been able to turn up, it is a one-man, two-boy operation consisting of a Brit who got struck off the register as a social worker in 2014 and a couple of Australians barely out of their teens. It’s not exactly the sort of line-up to get Warren Buffett reaching for his laurels.

Capitec’s response has been predictably capable, engaging with the investor community in a calm and rational fashion, rebutting the allegations and questioning why on earth Viceroy hadn’t been in touch before it published the report.

Clearly there are times when analysts can get too close to management teams, but a call or two shouldn’t be too much to ask for — unless you have a fat short position to feed and no desire to allow inconvenient facts to get in the way of a lucrative story.

Viceroy’s claims to credibility appear somewhat obscure . . . It is a one-man, two-boy operation