According to the latest annual results of shareholder African Rainbow Capital Investments (ARCI), the valuation of mobile network operator Rain has increased by almost US$170 million over the past year.
ARCI, of which billionaire Patrice Motsepe is a major shareholder and chairman, revealed that it invested another US$9 million in Rain in August 2024, bringing its shareholding to 21.0%.
Its results show that its estimate of the intrinsic value of its Rain shareholding grew from US$255 million in June 2023 to US$294 million in June 2024, representing a 16% jump in value.
Arc noted that this considers additional acquisitions of R126 million and fair value gains.
“Rain met its economic and customer service related targets, generating US$141 million EBITDA, resulting in fair value gain of US$33 million,” Arc reported.
“The introduction of RainOne, along with the 101 5G router, has significantly boosted Rain’s growth,” Arc said.
“This, coupled with the business having moved beyond its most significant period of net cash outflows, has been a key factor in the increase in fair value of Rain’s investment.”
Arc noted that these factors and the launch of its standalone 4G mobile service contributed to its performance.
“In July 2024, Rain launched its standalone 4G mobile service, and it continues to expand its coverage in various towns and major metros nationwide. It achieved its budgeted EBITDA for the year that ended in February 2024,” it said.
“Rain has solidified its position as an affordable data and mobile service provider and continues to experience substantial subscriber growth.”
It added that, while risks remain, Arc believe Rain is well-positioned to address them and further establish itself as a trusted brand in the country.
