Why investors should consider TransJamaican Highway’s public offer
As the Government of Jamaica prepares to divest its remaining stake in TransJamaican Highway Limited (TJH), investors are being presented with an opportunity to capitalise on the continued growth of Jamaica’s largest toll operator.
The public offer by the National Road Operating and Constructing Company Limited (NROCC) will be available at J$3.60 or US$0.0228 per share, opening on March 4, 2025, and closing on March 18, 2025.
During an NCB Capital Markets webinar on Thursday, wealth advisor Alana Lawrence broke down the stock’s track record and its future prospects, offering key insights for investors seeking capital appreciation, dividend income, and foreign exchange (FX) protection.
For those wondering about the stock’s potential, historical performance speaks volumes. Since its initial public offering (IPO) in 2020, TJH has demonstrated impressive growth, with its Jamaican-dollar shares surging by 170 per cent and US-dollar shares increasing by 128 per cent. This translates to an annualised return of approximately 20 per cent, highlighting the stock’s strong performance and resilience despite challenges in the broader equities market over the past three to four years.
“The stock presents a good opportunity in terms of low sensitivity to other asset classes,” she noted.
Beyond price appreciation, TJH has also been a reliable dividend payer, offering investors a steady stream of passive income since its listing. Over the past five years, TJH has consistently paid dividends to its investors, reinforcing its reputation as a reliable income-generating stock. In the last two years alone, the company distributed J$15 million in dividends annually, demonstrating its commitment to shareholder returns. Looking ahead, TJH projected a dividend yield ranging between 5.3 per cent and 8.7 per cent for the period 2020-2025. Beyond this time frame, the company anticipates maintaining a payout ratio of 25 per cent to 36 per cent, ensuring continued returns for investors.
For investors seeking stable returns, TJH’s dividend track record adds another layer of appeal, as it combines capital growth with income generation. One of the standout features of TJH is its dual listing on both the Jamaican and US-dollar stock markets on the Jamaica Stock Exchange (JSE), providing a built-in foreign exchange hedge for investors.
“This stock actually provides a hedge against movements in the Jamaican dollar versus the US dollar,” Lawrence explained.
This means investors can buy shares in Jamaican dollars and later sell in US dollars, offering flexibility in managing currency exposure and potentially benefiting from FX fluctuations.
Furthermore, TJH remains one of the most actively traded stocks, ensuring high liquidity for investors. According to Lawrence, the stock has been heavily traded on both markets over the past 52 weeks, allowing investors to enter and exit positions with ease.
Reinforcing its strong investment profile, Fitch Ratings has assigned TJH a ‘BB’ rating with a positive outlook, signalling strong creditworthiness relative to other companies in the region. While the fundamentals of TJH make a compelling case for investment, Lawrence cautioned that past performance is not a guarantee of future results. Investors should conduct their due diligence and consult their personal wealth advisors to assess whether this opportunity aligns with their financial goals.
“When you give consideration to these factors, the prospect of capital appreciation, and a steady stream of income, evidenced by the strong dividend payment history along with the hedge against the foreign exchange movement, I do believe that this offer presents a compelling opportunity,” she concluded.
Investors can apply for shares via NCB Capital Markets’ GoIPO platform and JMMB’s Moneyline App. While early applications will be accepted, they will not be processed until the opening date. All early applications will be treated as received at 9:00 am on March 4, 2025, ensuring fairness in allocation.
