Hisanet Africa Blog

  • Safaricom Allotment Figures Out

    Posted: May 30, 2008, 11:59 pm by admin

    The Minister for Finance, Amos Kimunya on Friday evening announced the Safaricom IPO allocations. The offer was oversubscribed by 532%. The government received 266billion Kenya Shillings against an offer of 50 billion Kshs. This comes three days after Safaricom announced a pretax profit of 19.9 billion Kenya Shillings for the financial year ended 31 March 2008. This was a 16 per cent growth on its Sh17.2 billion pretax profit recorded last year.

    The allocation figures are as follows:

    • 15% - International Investors (on average)
    • 21% - Retail Investors
    • 31% - Qualified Institutional Investors
    • 31% - Safaricom Dealers
    • 84% - Safaricom Employees

    Refunds cheques are expected before June 9 2008, the date that the shares will be traded in the secondary market for the first time.

    Safaricom is the dominant player in the mobile telephony market with Celtel playing catching up. This will be an interesting year for Safaricom and investors will be watching to see how it reacts to the entrance of Econet Wireless and Telkom Kenya in the mobile market later on this year. Already Celtel is provocatively engaging in a price war that Safaricom had largely ignored. Safaricom MPesa money transfer service is expected to be a huge revenue earner for Safaricom giving it a leeway to play nice in the price wars while maintaining its revenue reputation.

    The Nairobi Stock Exchange is awaiting the infusion of Safaricom IPO refunds with KCB and HFCK rights issues expected to be the immediate beneficiaries. With a low allocation for qualified institutional investors and international investors, the demand for Safaricom is expected to be high with a substantial supply expected from speculative investors.

    Safaricom is a regional blue chip company with a significant customer loyalty and revenue base, visionary leadership and in a “new-age” industry. It is worth holding and building up.

  • Kenya Airways reports 5.5bn pretax profit

    Posted: May 30, 2008, 11:58 pm by admin

    Kenya Airways reported 5.5 billion pretax profit for the year ended 31st March 2008. This was a 7.7% decline compared to last year’s 5.9bn. This was attributed to reduced passenger uptake in the last quarter following post election skirmishes, rising fuel prices and the loss of an aircraft in the crash in Douala, Cameroon in May 2007.

    KQ’s CEO Titus Naikuni noted the Europe and West Africa routes as the best performing routes. He requested the government to consider exempting the airline from VAT to enable it compete effectively with other airlines. The exposure to rising fuel prices was minimized partly by a strong shilling and the use of hedged contracts.

    KQ announced a dividend of 1.75 shs  to its shareholders. At the bourse Kenya Airways shares went up 5.75shs and traded at an average of 50.50 shs.

    This was by far the most trying year for the airline in recent years. With a grand coalition government now in place, an aggressive tourism marketing campaign in progress, fleet modernization project on course and the expansion of JKIA, the future is rosy for the Pride of Africa. However, it still has the challenge of increased competition and customer service challenges to improve on. Thumbs up to President Kibaki for flying Kenya Airways during his recent trip to Japan.

    All said, KQ is a good buy.

← March 2008 (4 items)

Blah blah blah

Fish cakes

Alas a fish cake.

Yet more fish cakes

Guess what ... yeah ... fish cakes.

The end of the fish cakes

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