Tuesday, April 05, 2011

NSE Nairobi Investor Briefs

new corporate activities at the Nairobi Stock Exchange include

British American Investments - a.k.a. British American a 46 year old company in the country now planning an IPO at the NSE. They are also embarking on regional diversification as a group, which is best known for its British American insurance (Britak) – but has since added British American asset managers (formed in 2005) and Britam insurance in Uganda.

In 2010 they had gross revenue Kshs. 4.5 billion ($56 million) (up from 3.9 B in 09) largely due to Investment & other income of Kshs 5.1 billion (09 was only 400k) and their profit before tax was Kshs 2.8 billion, compared to a loss of Kshs. 334 million the year before. This also included underwriting income in Kenya of Kshs 152 million (up from 80M year before)

They are aiming for the IPO in 2011 to finance their diversification into micro-insurance and bancassurance as well expansion to Tanzania, Rwanda and south Sudan. They are yet to obtain shareholder and capital markets authority approval. Group Managing Director Benson Wairegi said they have alerted the CMA, but are yet to submit documents until their shareholders approve the process

Kenya's capital markets rules require 3 to 5 years profitability before a company can list, though @coldtusker disagrees with that saying smart investors should be allowed to decide a company's prospects regardless of their recent profitability.

Other: - Their balance sheet grew to Kshs 25.2 billion ($315 million) up from 16.3B. Assets under management by British American asset management (BAAM) grew from Kshs 8 to 17 billion
- Expenses were up 8% compared to 16% for revenue
- Paid a dividend of 200M (Kshs 6.67 per share) up from 120M last year (Kshs 4 per share)
- Bank portfolio: they own 11% of Equity bank and 15.9% of Housing finance

TransCentury: Also up for possible listing is TransCentury which was founded by a Group of prominent Kenyan investors who expand into the limelight when they acquired East African cables in 2004. Since then they have taken stakes in Development Bank of Kenya, Kenya Power & Lighting company as well as Rift Valley Railways

Their 2010 highlights and 2009 detailed accounts show;
- High finance costs eating into profits and need to pay down debt
- Strong shillings bad for there profit 170m impact,
- Kshs 1 billion invested in 2009, down to 50 million in 09

Portfolio - Seem to manage regional diversification better than Olympia did and which Centum is now trying to do
- Quoted shares in Metal Fabricators (Zambia) 20%
- Unquoted in Rift Valley railways (34%) and Development Bank of Kenya

- In 2010, added Cableries du Congo (Congo Cables)
- Chai Bora Blended Tea (Tanzania) [Revenue of Kshs 714M, pre tax loss of 29M]
- Kewberg Cables & Braids [Revenue of Kshs 781m, pre tax profit of 44M]
- Tanelec (Tanzania) [Revenue of Kshs 772M, pre tax profit of 133M]
- Avery East Africa (Kenya scale) [Revenue of Kshs 226M, pre tax profit of 21M ]
- Participation in investment in funds include Kshs 200 million in Aureos (East Africa, South Asia, china), Helios (Kshs 350m) and Business Partners International (Kshs 43 million)

In anticipation of a NSE listing, they made moves such as:
- 10:1 share split in October 2008. Now has 263 million ordinary shares up from 20 million after bonus, split, and new issues
- Paid a dividend of Kshs 13 million in 2009 (DPS of Kshs 0.05). For 2008, it was 29 million, which was part paid in '09
- According to the East African in Feb '11, Transcentury shares were trade at an OTC market run by Dyer & Blair at Kshs 35 per share compared to Kshs 48 in 2010.
- Seem to manage regional diversification better than Olympia did and which Centum is now trying to do

Kenya Airways: Is likely to seek to raise capital from its shareholders this year on advice from their directors and CFC Stanbic who are their financial advisors.

Regional: In Tanzania, Kenya Airways is ceding a steak in Precision Air, which is seeking to raise almost $30 million, in an IPO, but indications are clear that Kenyans will be locked out as will other non-Tanzanians.

From Rwanda, we have the prospect of more share listings from two companies - Bank of Kigali and MTN Rwanda, and following in the footsteps of Bralirwa who's IPO was open to all East Africans.


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India Advisory Stock Research said...

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