Monday, February 06, 2006

No Kengen



Every investor I know is interested, setting money aside, and eagerly awaiting to buy Kengen shares - and time and again, investment bankers, government officials, and institutional investors have expressed sentiments that this will be the biggest IPO in Kenya’s history

But now the Sunday Standard has reported that the IPO will may lock out anyone who can't buy a million shares - which is contrary to earlier expressions on the part of the government that the IPO would be as fair as possible and be allocated to as many investors.

I don’t read political mischief in this, but it appears that Kengen is a can’t lose investment – and whoever gets the shares at say 20/= will immediately flip them on at the market price (say 100+ shillings) earning a substantial profit (and with no capital gains tax in Kenya, huge profits will be made). Still I am hoping that the controversial clauses may be removed to enable us small investors, who can't afford a million shares, to get a chance at the NSE's version of Goggle

6 comments:

mashatall said...

I checked out the Kengen website to go thru their financials, but couldnt get anything to come up on the link.My guess is there is political mischief, with the powers that be making sure that they lock down kengen for themselves.Icdc which is owned by akina Chris Kirubi, has already offloaded substatial shares in major companies, just to enable them snap up Kengen shares.Got a question though? has anyone done any good analysis on kengen, or is it just attracting good press coz its being hyped by the investment banks so that they can make a kiling? irrational exuberabce might be at play here although kenegen has a monopoly which hands it a good durable advantage.

coldtusker said...

Website & Financials

-Nothing on the website which is odd but could be incompetence. KQ & EABL do a fine job of posting the info... EABL is the best Kenyan firm in disseminating info in a timely manner to ALL stakeholders.

- According to newspaper reports (bankelele please reference these stories coz ur good at linking the websites) KenGen made KShs 1.7 Bllion.
- If 30% of KenGen is valued at KShs 10 Billion then 100% is Kshs 33 Billion. That means a P/E of 19. That is too rich for me!
- 2006 is a drought year thus probably reduced profits?
- They could have included write-offs in 2005 so it is unclear as to the "real" profits unless we get the financial docs.
- Yes, there is excessive hype thus ensuring a resounding "success" of the offer.
- The price will probably be in the teens thus an "attractive" price that seems "cheap" though could be very expensive in P/E terms.

I might do an analysis when the prospectus comes out... if I have time! www.coldtusker.blogspot.com

Anonymous said...

Githongo goes live!
Link to interview on BBC last night:
http://news.bbc.co.uk/nolavconsole/ukfs_news/hi/bb_wm_fs.stm?nbram=1&news=1&nbwm=1&bbwm=1&bbram=1&nol_storyid=4679986

brayogee said...

If the press report is true, why should we watch as Kengen shares are about to be sold to a few selected individuals close to the regime?

Lets go put it out there in the press as hard as Githongo did with his famous dossier and anyone thinking of locking out other tax payers who can afford these shares basically drop that idea as early March is a few weeks away.

Ama?

Concerned Kenyan said...

Nation Watchman is a start, who wants to go first

brayogee said...

checkout the East African Feb 20-26 issue for an article entitled 'No Special Treatment for big investors in KenGen share issue.

The sly moves by some big shots have been OFFICIALLY defeated due to public pressure. Can breathe easier now.

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