Time to jump ship
In the financial industry, hundreds of conferences are held annually, but one of the more important ones is the Sohn Investment Conference held every year in New York. It was here three years ago that the African Bank short was proposed and last week Jim Chanos of Kynikos Associates suggested shorting MTN. He has an excellent track record and it is important to take note of his views. Interestingly, Chanos is not worrying about the Nigerian fine, he is worried about the state of Nigeria and South Africa, which together make for two thirds of the telecoms operator’s profits. He says margins and average revenue per user (ARPU) will continue to fall in these two markets and the impact on profits is going to be disastrous.