TOP 5 STOCK PICKS - JSE 2023

The year of helium

AFRICAN RAINBOW CAPITAL

• ARC is the future golden child of billionaire Patrice Motsepe. Please see my previous article here https://finmeup.app/post/fd8d0e23-bbd3-460a-988d-c01881f2c80a
• I did not select ARC in 2022 due to the uncertainty around Rain and the fact that I have never seen financial statements for TymeBank
• Rain is a strong competitor for government projects.
• TymeBank is still bleeding cash due to high set-up costs, but that should normalise.
• ARC has a strong PE Ratio of 6.2
• Share is trading at R6.27 with a Net Asset Value per share of R9.88

GRINDROD LIMITED

• Grindrod had an amazing 2022, so why add it again in 2023? Simple, there is still runway left in the share price based on some uncertainties
• Grindrod is still the only listed company that can benefit from the Transnet Third Party Access
• The company has a significant amount of cash they can utilise to increase the share price
• Forward PE ratio is reasonable 7
• Share is currently trading at R10.53

SANTOVA

• I added Santova for the first time in 2022 and I am currently up over 30%
• Santova is a logistics company that uses sophisticated technology to give them an edge. They have a presence in 11 countries
• Santova is perfectly placed to benefit from the global supply chain issues the world is experiencing
• This could be a perfect diversification play should the looming global recession transpire
• Share is currently trading at R8.15

PURPLE GROUP

• PPE had a horrible 2022 with the share price peaking at R3.50 and closing the year under R2
• You need to divorce the share price from the business and only look at the business
• EasyEquities is still adding thousands of customers per month
• During volatile markets retail investors tend to panic and trade, leading to increased fee income
• EasyEquities has tangible plans for the rest of Africa, Eastern Europe and the Philippines
• New product offerings the group plans to roll out include script lending, insurance etc. will increase revenue

RENERGEN

• Nobody has to be more patient than a Renergen investor, as 2022 we had high hopes that the helium will come online, and we are still waiting
• The plant was riddled with safety concerns resulting in delays
• The highlight of 2022 was most definitely the LNG being delivered and Renergen officially becoming a producer, up from an exploration company
• In December 2022 Phase 2 of its Virginia Gas Project reached Strategic status after it was designated a Strategic Integrated Project (SIP) by the South African government. This means that any approvals needed for Renergen will be fast-tracked significantly
• The February 2023 year-end results will for the first time include revenue for the LNG
• I am still saying, the helium is where the money is and the day that comes online, we convert the non-believers. I think that might just be the year 2023

Disclaimer: Nothing in this article should be seen as financial advice. Everything stated is for educational purposes only. Always do your own due diligence