MTN is a good opportunity for investors

October 22nd 2025

Africa, Investment, MTN, South Africa, Telecom News

MTN remains a good opportunity for investors despite a recent run in its share price, according to Benguela Global Fund Managers portfolio manager Grant Nader.

Nader said that uncertainties around foreign exchange rates in MTN’s biggest markets have caused its share to remain relatively cheap.

However, Protea Capital Management CEO Jean Pierre Verster said that while much of MTN’s foreign exchange headwinds have subsided, it is not in his sweet spot as an investor.

MTN has 298 million customers in 16 markets across Africa, with separately listed operating companies in Nigeria, Rwanda, Ghana, and Uganda.

South Africa, Nigeria, Ghana, and Uganda are its largest markets in terms of contribution to group service revenue. MTN reported overall service revenue of R105 billion in its latest results for the first six months of 2025.

Of this, Nigeria contributed 26.9% (R28.2 billion) to the group, South Africa 20.6% (R21.6 billion), Ghana 19.7% (R20.7 billion), and Uganda 8.2% (R8.6 billion).

MTN also posted a net income of R9.75 billion after reporting a loss of R7.39 billion in the same period last year because of currency depreciations in Nigeria and Ghana.

The company said it has streamlined the group’s focus to build three platforms comprising connectivity, fintech, and digital infrastructure.

“We have been running a strategy of decoupling some of the digital infrastructure assets,” MTN Group CEO Ralph Mupita said.

“The process of carve-outs, we will continue to progress with that as part of our strategy.”

MTN’s share price has suffered in recent years due to the significant depreciation of the Nigerian naira. It experienced a particularly torrid start to 2024, as its share price plummeted when the Naira collapsed.

However, the share price has since recovered, climbing from lows of R70.43 on 5 August 2024 to highs of R174.23 on 15 August 2025 — a level the MTN stock had not seen since 2022.

Diverging views on MTN

In addition to its African operations, MTN also has a mobile network in Iran called Irancell and had investments in Afghanistan, Syria, and Yemen, which it has exited.

While the company has been dogged for years by lawsuits originating from the United States over its involvement in Afghanistan and Iran, it is now facing scrutiny from the U.S. Department of Justice (DoJ).

Among the allegations brought against MTN is that it helped fund the travel of Iran’s nuclear negotiator to meet former President Thabo Mbeki in South Africa.

A group of U.S. citizens claiming damages from MTN also alleged that it paid protection money to the Taliban to allow it to operate its former network in Afghanistan without its infrastructure being attacked.

They claim MTN was culpable in the casualties of hundreds of American soldiers and civilians while serving in Iraq and Afghanistan between 2006 and 2010.

MTN is embroiled in five active U.S. lawsuits involving the Anti-Terrorism Act. In addition, it disclosed with its half-year results that it was cooperating with the U.S. DoJ in a grand jury inquiry.

Responding to questions about the grand jury inquiry, Nader said it appeared as though the market was looking past the allegations.

“This has been a long story, dragged out for a long time, and I don’t see evidence that it is being priced as a major risk,” said Nader.

“I think MTN is still relatively cheap even though it’s had a good run, but I don’t think it’s because of that. I don’t think it’s because of the SEC (Securities and Exchange Commission) overhang.”

Nader said he believed MTN’s stock was still cheap because of the uncertainties around Nigeria and its exposure to the volatility in the rest of Africa and local currencies.

“You know, the legacy of the hyperinflation challenges. So, yes, I think MTN is still a reasonably good opportunity at these levels.”

Verster said he considered telecommunications players like MTN as utility stocks. He said MTN is in many mature markets, and where they aren’t mature, they face foreign exchange headwinds.

“In the last year and a half, a lot of those foreign exchange headwinds have subsided and sometimes even turn into tailwinds,” he said.

“But longer term, it’s not my sweet spot. It’s not a growth company at a fair price. Those are the companies that I prefer.”