Deals 5,344
Turnover Kshs. 462.6 million ($7.34 million)
Average 7.86
Closing 7.85
High 7.90
Low 7.80
Last 7.85
Volume 58.9 million shares
Commentary: Very tight range. 8.00 remains the pivot. We are still distributing shares just below that level. Crossing 8.00 will be a bullish development. 7.50 – 7.70 is strong support. Data courtesy of Rich.Co.Ke [NSE data vendor]
yes it’s Wednesday, but these relate to recent events
2008 Budget
– While the ICT sector was celebrating, a 25% tax on imported used computers was added on
– Wireless providers also pay a 10% tax, same as mobile companies (putting Telkom wireless on par with Safaricom and Celtel)
– Whistle blower on tax evasion may be entitled to 3% or 5% tax recovered by KRA. (but too late for David Munyakei)
– And from Tanzania; a brilliant idea that sounded dumb initially – at tax on loss making companies; It’s an alternative minimum tax for companies that report tax losses for three consecutive years – and will now amount to of 0.3% of their turnover. This is targeted at companies with high turnover that engage in tax avoidance could KRA adopt that later?
CFC Stanbic: In the CFC-Stanbic merger/takeover, shareholders voiced concerns that some CFC shareholders were getting paid and walking away from the company with cash. Now three of them – Gambit, Trogon, and Jani are voluntarily winding up
IPO refunds: The Central Bank is concerned about the slow pace of Safaricom refunds (statement (PDF))
– Yet there was there option in the initial prospectus for applicants to be refunded by M-pesa; which would have been ideal for thousands of minimum applicants [who are getting refunds of about 7,900 shillings or $127]
– The CBK statement mentions that you can send a message to confirm the status of your refund e.g. “CDS#ID#R” to 4009. (my message told me my cheque which I collected last week, was ready at the broker). What it doesn’t tell you is that the message costs 15 shillings or ~ 2 Safaricom shares at the going rate
Deals: 5,620
Turnover: Kshs 883.5 million [$14 million]
Average price 7.84
Closing 7.80 (no change)
High 7.90
Low 7.70
Last 7.90
Volume 112.6 million shares
Commentary: We are still below the 8 pivot, which is key. The pull back was very shallow and confirms underlying muscularity. Foreign buying and selling is now in balance. Courtesy of Rich.Co.Ke [NSE data vendor]
All Safaricom, all the time?
Meanwhile AKS [Rich.co.ke] has a Nairobi Star column and in February this year, started a running NSE portfolio 2008 with Equity, Access Kenya, Athi River Mining, and Sasini. This week, he retired the portfolio – cashed in a 50% gain to throw everything into Safaricom!
Mainstream blogging
stuff I used to post about and need to get back after IPO rush
Meet the bloggers: The Nairobi barcamp is now set for June 21 and is shaping up to be one of the biggest ever with a packed day planned
Meet the money: Two opportunities for bloggers to meet the e-government, BPO, and Kenya ICT Board officials on 19th and 21st of June. first come, first served
Deals 10,506
Turnover Kshs. 950.9 million [$14.86 million]
Average price 7.83
Closing 7.80 (-1.27%)
High 8.05
Low 7.70
Last 7.80
Volume 122 million shares
Commentary:
Slightly more defensive session ahead of 8.00 which is now the pivot. We will cross 8.00, its a question of time. Sellers will be exhausted given the turnover
– This morning: Excluding today, total share volume has been 1.2 billion shares which is 12% of the total shares sold. Shares are moving quickly from loose hands into those of medium term Investors. 8 and around is currently the clearing price for the flippers. Crossing 8 will be bullish
– Courtesy of Rich.Co.Ke [NSE data vendor]
Deals 5,624
Turnover 821 million shillings ($13 million)
Avg price 7.91
Closing price 7.90 (up 6.38%)
High 8.15
Low 7.70
Last 7.95
Shares volume 103.8 million shares
Commentary: The Bourse had a delayed start. It was a very bullish session. We are now toying with 8.00 and a break of which will project us another 10% higher- Courtesy of Rich.Co.Ke [NSE data vendor]
Lessons Learnt from Safaricom
1. Don’t invest in IPO’s! avoid the queues, time value lost, miniscule allocations, rogue broker tales, bank charges, fraudsters etc.
2. If you must invest, go for those with ‘higher’ minimum investments of Kshs. 50,000 or 100,000. e.g. Access Kenya a ‘relatively unknown’ (to wananchi) was priced at 50,000 and still ended up with 25,000 shareholders who got a reasonable allocation.
3. If advance payment is unfair for foreign investors and QII, it is also unfair for wananchi (retail investors)
4. Bank IPO loans should be banned.
Both of the above two factors destabilize the banking sector
5. We don’t need foreign investors. The local investors over-subscribed the entire allocation. The Renaissance Boss once talked about how it was not possible to invest $20 million without distorting the NSE. We are a retail, small corporate, local bourse and should accept that,
6. We don’t need the kind of foreign investors we appear to have got. African bourses need long term investors with three to five year horizons – not 3 to 5 day ones who cash in for 2 shillings.
ARM dust?
What happened at the Athi River Mining AGM last week? The vote results on the proposal to split the company into two subsidiaries appears to have only had the backing of the MD who accounted for almost all the votes for the move to be approved.