XSML Capital invests $2.5m in Angola's auto sector

XSML Capital has recently expanded its portfolio with an investment in Angola's automotive industry.

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XSML Capital has recently expanded its portfolio with an investment in Angola's automotive industry, providing a US$ 2.5 million loan to support the working capital needs of Advancetire Comercio, a retailer and wholesaler of car parts.

Advancetire sells only original tires (52% of sales), spare parts (18% of sales), lubricants (17%), batteries (8%) and tools and accessories.

Advancetire has five shops, three in Luanda, the country’s capital, one in Soyo in the north which is the largest oil-producing region in Angola, and one in Lobito, home to the main seaport. It also sells its products, which are all imported, to franchisees and even to some competitor shops.

“Our approach is to educate the customer. For example, it is important that you buy the right kind of lubricant for your car or vehicle,” Radwan Faraj, who founded the company in 2019. He has more than 25 years of experience in the sector and ran his own company in the US before exploring opportunities in Angola.

The sector is forecast to grow more than 10% annually as the government is promoting investment in infrastructure, construction, real estate, manufacturing and agriculture to diversify the economy which relies primarily on the oil production. “All these activities use vehicles. They need our products,” says Faraj.

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