NTS set to delist from ZSE

SAMANTHA MADE

National Tyre Services Limited (NTS) is set to delist from the Zimbabwe Stock Exchange (ZSE), pending shareholder approval, as the company grapples with deep-seated operational and market challenges in a difficult economic environment.

The company said the decision follows a comprehensive evaluation of its listing status, market trading dynamics, and long-term sustainability.

“Following a comprehensive review of the Company’s listing status, market trading dynamics, and long-term sustainability, the Board has resolved to seek shareholder approval for the voluntary termination of the listing of NTS on the Zimbabwe Stock Exchange (ZSE),” the company announced.

NTS has been hit hard by Zimbabwe’s persistent macroeconomic instability, severe exchange rate volatility, and liquidity constraints, which have undermined its ability to import tyres and raw materials. The company has also struggled to navigate an increasingly competitive market, as low entry barriers have encouraged an influx of imported tyre brands, eroding NTS’s market share.

“The Board believes that these resources would be better deployed towards operational improvements and business development initiatives that directly enhance shareholder value,” the company stated.

Operationally, NTS continues to face severe bottlenecks, including unreliable power supply that has disrupted production at its retreading factory—where capacity utilisation has averaged just 30%. Frequent electricity outages have also hurt branch operations, resulting in estimated revenue losses of up to 40% of projected sales.

“Operationally, NTS continues to face significant challenges. The current power supply deficits have disrupted production at the retreading factory, where capacity utilisation has averaged approximately 30%. Frequent electricity outages have negatively affected branch operations, resulting in estimated revenue losses of up to 40% of projected sales. Extended supply chains from Asia, where most tyre suppliers are located, have further strained the Company’s liquidity by locking up working capital in goods in transit for prolonged periods,” the company said.

Cash-flow constraints have made it difficult for NTS to meet its listing obligations, including annual fees and restocking requirements. Over the 12 months ending July 31, 2025, NTS shares did not trade in eight of those months, reflecting deep illiquidity on the local bourse.

“This illiquidity has undermined effective price discovery and limited shareholders’ ability to realise value or exit their investment positions,” the company said.

Average monthly trading volumes have been below 3.5 million shares, and the Board noted that the costs of maintaining a listing have become disproportionate to the benefits. The delisting, the Board said, is intended to free up resources for operational efficiency and strategic reinvestment.

As part of the proposed delisting process, Radun Investments (Private) Limited—a major shareholder in NTS—has offered to acquire up to 94,513,956 ordinary shares, representing 37.73% of the company’s issued share capital, at a price of US$0.0248 per share. This offer gives minority shareholders the opportunity to exit before the delisting takes effect.

“Accordingly, the Directors recommend that shareholders vote in favour of the termination and, if they wish to divest their holdings, consider accepting the voluntary offer in accordance with its terms,” NTS said.

If shareholders approve the special resolution, NTS will become a private company, with its shares no longer publicly traded on the ZSE. This move would significantly reduce liquidity and marketability for remaining shareholders, but management insists it will strengthen long-term value creation.

Despite the planned exit from the stock exchange, the company remains optimistic about its future prospects.

NTS plans to refocus its strategy on expanding its national footprint through branch optimisation, refurbishment of key outlets, and improved customer service. It also aims to penetrate underserved markets to drive growth and broaden its revenue base.

The company is pursuing strategic partnerships to diversify its product and service portfolio, including complementary automotive offerings and stronger digital engagement channels.

Going forward, NTS will prioritise operational efficiency and cost control through enhanced procurement systems, tighter inventory management, and cost-rationalisation initiatives aimed at protecting margins and improving shareholder value.

Additionally, the company intends to leverage the growing demand for affordable tyre solutions by scaling up its retreading and fleet-management businesses. Investments in automation, digital platforms, and data-driven decision-making are expected to improve customer experience and enhance operational responsiveness.