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May 21, 2018

Safaricom eases on opposition remarks

Safaricom CEO Bob Colleymore. /FILE
Safaricom CEO Bob Colleymore. /FILE
Fed Reserve chairwoman Yellen's comments late yesterday increased the likelihood of a rate hike before year end to more than 70%.
The dollar had been in a precipitous swoon in 2017 as ''Trump'' related geopolitical risk created a reflexive negative feedback loop for the dollar.
However, like a phoenix rising from the ashes the dollar has pushed back against the euro [1.1722 last] as post Angela Merkel and ahead of the Catalonia referendum, Political Risk has returned onto the Radar.
Crude Oil (and this is a case of Mea Culpa) has surged higher of late and especially since President Erdogan said,
"After this, let's see through which channels the northern Iraqi regional government will send its oil, or where it will sell it," Erdogan said in a speech. "We have the tap. The moment we close the tap, then it's done."
That 600,000 barrels of the stuff right there and the Kurdistan referendum has brought Middle Easts geopolitical issues back to the surface and put a premium into the price.
The Shilling was last at 103.33 versus the Dollar well within range.
The Nairobi All Share Index retreated -0.608% to close at 165.01.
The Nairobi NSE20 eased -3.20 points to close at 3729.84.
Equity turnover clocked 510.122m. 
“The opposition leader’s comments about Safaricom have been discounted to zero” I told Reuters regarding the opposition leaders comments. Safaricom was the most actively traded share at the Exchange and eased -0.96% to close at 25.75 and traded 6.92m shares worth 179.721m. Safaricom is +39.53% on a total return basis in 2017 and any weakness is a buying opportunity ahead of a move above 30.00 year end. The transfer of the Vodafone shareholding to VODACOM effectively indigenises the ownership of the company and unlocks geographical expansion, which is currently not baked into the price.
KCB Group eased -0.59% to close at 41.50 but was trading at session lows of 40.00 -4.19% at the closing bell. KCB traded 987,400 shares. 
Britam Holdings' announced yesterday that Africinvest III- SPV 1. (a vehicle that contains FMO, DEG and Proparco) proposed subscription for a 14.3% equity stake in Britam Holdings Plc. The Tunis-based multinational will buy 360.8 million Britam shares at Sh15.85 each, matching the price at which the International Finance Corporation recently acquired 224.2 million shares or a 10.37 per cent stake in the insurer for Sh3.5 billion. Britam EA eased 5 cents to close at 14.90 and traded 216,600 shares. Britam EA is +49.00% in 2017. 
ARM Cement rebounded +4.035% off a nine year low to close at 11.60 on heavy volume action of 12.407m shares (some 1.25% of the issued shares of the cement company) worth 144.023m. ARM sank to a nine year low after it announced it was selling its fertiliser business and looking for a strategic investor. 
KenGen was low ticked -2.79% to close at 8.75 and traded 173,800 shares. There was a bid for 4 times the entire volume traded at 8.50 and that marks the deepest this correction will go. 
Mumias Sugar is set to conduct a trial run for its refurbished factory in the next two weeks, marking a restart to the factory’s operations following its closure in May 2017. Mumias Sugar rallied +4.76% to close at 1.10 but remains -15.38% in 2017, 
EABL firmed +0.40% to close at 251.00 and was trading at session highs of 255.00 +2.41% at the finish line. EABL traded 60,400 shares. 
KenolKobil eased 

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