The Uganda Stock Exchange Q1 2025 performance revealed a steep decline, with turnover falling from Shs24 billion in Q1 2024 to Shs17 billion this year. The 29.35% drop marks one of the sharpest quarterly downturns in recent memory and has raised alarm among investors and analysts.
Paul Bwiso, CEO of the Uganda Securities Exchange (USE), linked the decline to the unresolved Umeme buyout. The suspension of Umeme trading, triggered by uncertainty around the buyout price, halted a major volume of investor activity.
“Many investors held back from selling because there was no agreed price on Umeme shares,” Bwiso said.
Umeme has consistently ranked among the most active counters on the USE. Its absence has not only reduced trading volume but also shaken investor confidence.
According to the USE’s Q1 2025 report, turnover dropped to Shs16 billion. However, share volumes rose from 118 million in Q1 2024 to 122 million in Q1 2025. The number of deals also climbed from 1,762 to 2,165 during the same period.
USE management noted that Umeme’s suspension removed a high-volume stock and contributed to market caution. Traders avoided major moves while waiting for clarity on the buyout.
Despite the setback, exchange officials remain hopeful. They believe that resolving the Umeme situation could restore liquidity and boost investor participation in the months ahead.
Meanwhile, the Capital Markets Authority has encouraged non-bank financial institutions to apply for primary dealer licenses. This move aims to boost transparency and improve liquidity in Uganda’s fixed income market.
As Q2 unfolds, all eyes are on the outcome of Umeme negotiations. A positive resolution could help reverse the weak start to 2025 and revitalize the capital markets.
