Kgori Capital: spreading wings into the next decade
Kgori Capital has seen it all. However, the company executives have always remembered why they established the asset management company in the first place. As a truly 100 percent citizen owned asset management firm, the company promises another ten years of many firsts and feats. Below MD, Alphonse Ndzinge responds to KOOBONYE RAMOKOPELWA’s questions.
BOTSWANA GUARDIAN: Kgori Capital has been operating for ten years in the country’s cutthroat asset management industry. What experiences have you learnt that could inspire those who plan to enter the market?
ALPHONSE NDZINGE: New entrants need a long- term mindset and commitment. There will be challenges along the way, but it is important to remain driven and resilient; and remember the reason for embarking on the journey of starting the business in the first place. Sound business structures, practices and ethics from the onset are critical.
GUARDIAN: What specific services/ products does the company offer?
NDZINGE: Kgori Capital provides client- driven, local, and international investment solutions to pension funds, corporates, charities and individuals. For institutional investors, we offer separately managed accounts with a focus on equity, fixed income, and multi- class mandates. For individual and corporate investors, we offer two- unit trust funds, namely the Kgori Capital Enhanced Cash Fund and Kgori Capital Global Balanced Fund. The Enhanced Cash Fund is a low risk, cash management strategy used as an alternative to bank fixed deposits. The Global Balanced Fund is a moderate risk multi- asset growth strategy suitable for investors with a medium to long- term investment horizon.
GUARDIAN: Are there any plans to expand Kgori Capital’s existing line of products/ services?
NDZINGE: Yes, we will be introducing new investment solutio ns in the coming months.
GUARDIAN: What is your investment philosophy?
NDZINGE: Our investment approach across the firm revolves around a single concept: optimising performance over the medium to long term without exposing our clients to unnecessary risk. We believe in active investment management with a balanced focus on risk and reward. Our active management philosophy is underpinned by the premise that fundamentals and valuations converge over time.
GUARDIAN: Will you be kind enough to name two or three of your clients?
NDZINGE: Our clients include a diverse range of corporates, including banks and insurance companies, parastatals, government entities, and individuals.
GUARDIAN: Explain to us your growth story from being established as a Afena Capital to now being known as Kgori Capital.
NDZINGE: Kgori Capital ( initially called Afena Capital Botswana) was established in September 2012 as a joint venture between Afena Capital and a citizen management team. We were awarded our first mandate in early 2013 and grew the business from there. In 2016, management and staff completed the acquisition of shares held by Afena Capital to become a pioneering, fully independent, owner operated asset management company. Our name was changed from Afena Capital Botswana to Kgori Capital in 2017.
GUARDIAN: As a truly local asset management, were there any peculiar challenges that you faced during your early years of existence?
NDZINGE: Naturally, there were many skeptics in the early years. We needed to demonstrate that we could deliver.
GUARDIAN: How many job opportunities has the firm created and is there any upskilling of staff members?
NDZINGE: We have a team of 10 skilled and experienced staff members. Growing and becoming an active player in the growth and development of talent in our sector is at the core of what we do.
GUARDIAN: In your own opinion, is there anything that government can do to make the environment more conducive for 100 percent citizen owned asset management firms to thrive?
NDZINGE: I believe that the Government and related institutions understand it is in the country’s best interest to build up meaningful local participation in the industry. I also firmly believe that citizen owned companies have demonstrated the y are as capable as any other firms.
GUARDIAN: Broadly speaking, how do you describe the country’s asset management industry?
NDZINGE: The asset management industry has grown significantly in the last few years with increased assets, new competitors, and regulatory oversight.
GUARDIAN: What is the importance of strong corporate governance systems to a company like Kgori Capital?
NDZINGE: Strong corporate governance is the bedrock of our business. Good corporate governance structures provide the foundation to develop a culture of ethical behavior, transparency and accountability across the business which builds sta keholder trust. And building trust is key in our industry.
GUARDIAN: What are some of the sustainable projects/ initiatives that the company is currently embarking upon to positively impact on the society you operate in?
NDZINGE: Kgori Capital is committed to giving back, building, and supporting communities it operates in and we have launched several high impact social projects over the years. Our corporate citizenship initiatives have an education threading with programmes like the Kgori Press Club, Responsible Investment Seminars, Trustee Training, Internship Programme, Unpacking Jargon ( Financial Dictionary) and being the Lead sponsor of the Botswana Pensions Society Conferences.
GUARDIAN: Where do you see Kgori Capital in the next ten years?
NDZINGE: Kgori Capital is a strong, stable business that is passionate and committed to becoming a significant participant in the Botswana investment management industry. We have ambitions to grow the firm in terms of assets under management, number of clients, investment products and distribution channels. We will invest significantly in the development of skills and capabilities to support these growth ambitions. We are also committed to being a key part of capital market development in Botswana, a task that will require ingenuity and innovation.
GUARDIAN: On an unrelated matter, what is your view on the domestic economy?
NDZINGE: We recently revised our 2022/ 23 domestic growth expectation to 6.4percent on the back of buoyant mining sector activity. The risk here is probably to the downside as global growth expectations are being revised downwards with the war in Ukraine, lockdowns in China, supply- chain disruptions, and the risk of stagflation. On the ground, for the short- term, we expect financial conditions to remain increasingly challenging as BoB continues to hike rates to restrain inflation and maintain interest rate differentials with trading partners.