Our opinion on the current state of CTA

Capprec (CTA) is a fintech company offering payments and payment infrastructure as well as software and services. Patrice Motsepe's African Rainbow Capital (ARC) owns a stake. The payments side of the business is done through African Resonance and Dashpay. The software side involves systems development and consulting. The company owns 17,5% of Resonance Australia - a startup business. The company has all the major banks in South Africa as clients. In its results for the year to 31st March 2023 the company reported revenue up 19,7% and headline earnings per share (HEPS) down 44,5%. The company said, "Continued growth in terminal estate, up 18% to 328 000 - Strong growth in Payments' annuity income, up 24.1% - Expected credit loss provision raised of R70.8 million for loan to associate, GovChat, impacted on EPS and HEPS". In a business update for the six months to 30th September 2023 the company reported, "There has also been a tendency to prolong the productive life of customers’ payment terminal fleets and defer capital expenditure into future periods. Despite these headwinds, the Group is strategically well-positioned in a growing market and has made good progress in gaining new customers, diversifying its revenue streams and increasing its market share". The share now trades at a P:E of 18,82 because of the substantial loss provision made. Roughly R500 000 worth of shares change hands each day - which makes this share quite feasible for private investors. The company appears to be well-managed, profitable, and cash-flush - which means that it is beginning to attract institutional interest. Technically, the share has been in an downward trend since January 2022 and we advie waiting for a break up through its downward trendline.