Our opinion on the current state of AYOAYO is a black-owned technology company spun out of AEEI, which still holds a 49.4% stake in the business. The company has faced significant controversy, particularly surrounding a massive R4.3 billion investment by the Public Investment Corporation (PIC). This investment has been the subject of legal action, which was finally settled on 31st March 2023, with AYO agreeing to pay the PIC R619 million. The settlement has left many questioning the financial integrity of the deal, with allegations that PIC pensioners lost billions of rands.
AYO shares listed at R43 but dropped dramatically, reaching a low of 105c. The share has since recovered slightly and is currently trading around 305c after its latest results. However, trading volumes remain extremely thin, with many days seeing no activity at all. The company employs approximately 1,400 people, and a significant portion of its income appears to come from interest on the remaining PIC funds.
Concerns about AYO’s governance and financial reporting have persisted for years. Former financial director Siphiwe Nodwele testified before the Mpati Commission that the company is likely only worth R700 million. Former CFO Naahied Gamieldien also admitted to adjusting margins to artificially inflate profits, resulting in the company’s profit doubling. These admissions, along with other governance issues, have cast doubt on the company’s reported financials.
In October 2019, the Financial Sector Conduct Authority (FSCA) raided the offices of Iqbal Survé, who is associated with AYO, as part of an ongoing investigation. In addition, FNB closed AYO's bank accounts due to reputational risks. While AYO announced on 30th April 2021 that it had put in place "alternative third-party solutions" to enable continued trading, these actions have not alleviated investor concerns.
On 1st June 2021, British Telecom (BT) severed ties with Sekunjalo, citing "misrepresentation of facts" presented to Parliament’s Standing Committee on Finance. Further governance lapses were highlighted on 10th February 2022, when the JSE barred two AYO directors from serving as directors of listed companies for five years due to their failure to ensure accurate financial reporting. On 22nd December 2022, the JSE publicly censured AYO for engaging in related-party transactions without complying with listing requirements.
In its results for the year to 31st August 2024, AYO reported revenue down by 17% and a headline loss per share of 71.81c, an improvement from the previous year’s loss of 176.46c per share. Despite these figures, trust in the company’s reporting remains low, and we cannot recommend the share to private investors.
On 6th September 2023, the JSE publicly censured AYO director Khalid Abdulla for breaching listing requirements and failing to fulfill his fiduciary duties. He was fined R2 million, while AYO was fined R6.5 million. On 14th June 2024, AYO announced the appointment of Dr. N.A. Ramatlhodi as Chairperson.
Most recently, on 24th January 2025, AYO disclosed that a shareholder with a 0.13% stake in the company had filed a court application for its liquidation. AYO is opposing this application, further adding to the company's challenges.
Given its history of governance failures, legal controversies, and unreliable reporting, we strongly advise private investors to avoid this share. The ongoing uncertainties, legal battles, and reputational risks make it a highly speculative and potentially dangerous investment.
