Nitl projects K28 billion loss, analysts blame MSE decline

National Investment Trust plc (Nitl), a Malawi Stock Exchange-listed collective investment scheme, is set to post a K28 billion loss in a develoment analysts attribute to weak performance of the 16-counter local bourse in the first half (H1) of this year.

Nitl’s projected loss is the first direct impact of the market slump experienced in H1 as stock market analysts expect institutional investors to face revenue decline.

Market data show that MSE registered negative return of -12.67 percent by half year with market capitalisation dropping from K32.5 trillion on December 31 2025 to K28.4 trillion on June 30 this year following share value drops in most financial and telecommunications counters.

In a trading statement, Nitl said its H1 losses are expected to range from K24.5 billion to K28.5 billion from a profit of K84 billion during the same period last year, representing a 130 percent drop.

Reads the statement: “The decline in profitability is largely due to the weak performance of Malawi Stock Exchange as reflected by the negative return on the Malawi All Share Index at -12.67 percent compared to a positive return of 91.17 percent achieved in the corresponding period last year.”

In an interview on Wednesday, Stockbrokers Malawi Limited equity investment analyst Kondwani Makwakwa said the projected H1 loss reflects the direct impact of the sharp deterioration of MSE, with the market shifting from strong positive returns last year to negative territory this year.

“Given Nitl’s exposure to listed equities, weaker investment income was largely unavoidable and this highlights the sensitivity of earnings to market conditions,” he said.

Makwawa said recovery will largely depend on an improvement in capital market performance during the second half.

In a separate interview, Stock market investor Purity Chitalo said as an investment holding company, Nitl’s profit and loss is heavily tied to movements on MSE.

“Investment companies are cyclical by nature. The 2025 gains and 2026 first half weakness are two sides of the same equity exposure coin,” he said.

Chitalo attributed the weak performance of the MSE to institutional investors’ desperate offloading of stocks in compliance with regulations that limit equity investment of pension fund managers and life insurance companies, thereby  increasing supply of shares and dampening prices.

In an interview on Tuesday, market analyst Brian Kampanje said apart from the introduction of capital gains tax, which pushed retail investors into a panic sale, pension fund managers and life insurers are also compelled by law to dispose some stocks, resulting in oversupply and pulling prices down.

Market data show that the local bourse, whose capitalisation surged to K33 trillion in December 2025, declined to K28.4 trillion by June 30 2026 as shares of nine of the 16 listed companies plummeted.

Nitl posted a record- breaking annual profit of K202 billion in 2025 when MSE recorded 247 percent return on index, outperforming all stock markets in Africa.

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