If my memory is not failing, there were several offer slated for the 1st half of 09 that have just disappeared into oblivion. Nothing is being mentioned of them in our Kenyan business media. Some that were slated for this year included DPL Festive Ltd, Telkom Kenya, K-rep and Nakumatt. The most recent announcement of intentions to list on the NSE has been Radio Africa (just launched KISS TV), Family Bank and Consolidated bank.
Others that also mentioned they’ll be seeking to list anytime were KenGen’s 2nd offer, Sarova Hotels, Wananchi Online, NSE (Demutualization) and Suntra Investment bank.
Also in line were several government of Kenya privatizations, with the likes of Kenya Wines Agencies, Kenya Ports Authority, Kenya Pipeline Company, Kenya Meat Commission and New-KCC being fronted. I think the government privatizations are still on course with the recent appointment of two transaction advisors.
BLUE Financial Services from down South Africa was also planning to cross list on the NSE but has since gone mum on when this will ever materialize. Similarly, with the finalization of the integrated East Africa bourse Ugandan Tanzanian and even Rwandan firms were set to cross list on NSE. But this will remain a pipe dream for a few years to come has the four countries sort out their ‘abusive’ relationships.
Sectors to invest in:
Regardless of the IPO’s dry spell I still consider Financials (especially banks), telecoms (Safaricom n Telkom Kenya on listing), construction (ARM’s, Bamburi, not Olympia), ICT (Accesskenya) and energy (KenGen, KPLC and KPC – despite the inefficiencies n desputes) as viable sectors to invest in at the NSE. Agriculture and Insuance are too risky for now.
Others that also mentioned they’ll be seeking to list anytime were KenGen’s 2nd offer, Sarova Hotels, Wananchi Online, NSE (Demutualization) and Suntra Investment bank.
Also in line were several government of Kenya privatizations, with the likes of Kenya Wines Agencies, Kenya Ports Authority, Kenya Pipeline Company, Kenya Meat Commission and New-KCC being fronted. I think the government privatizations are still on course with the recent appointment of two transaction advisors.
BLUE Financial Services from down South Africa was also planning to cross list on the NSE but has since gone mum on when this will ever materialize. Similarly, with the finalization of the integrated East Africa bourse Ugandan Tanzanian and even Rwandan firms were set to cross list on NSE. But this will remain a pipe dream for a few years to come has the four countries sort out their ‘abusive’ relationships.
Sectors to invest in:
Regardless of the IPO’s dry spell I still consider Financials (especially banks), telecoms (Safaricom n Telkom Kenya on listing), construction (ARM’s, Bamburi, not Olympia), ICT (Accesskenya) and energy (KenGen, KPLC and KPC – despite the inefficiencies n desputes) as viable sectors to invest in at the NSE. Agriculture and Insuance are too risky for now.
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8 comments
Kenyan are now not into I.P.O's after what happened with Safaricom for example Co-op's I.P.O was not that a success plus the banks share price is now lower than its actual Buying price. Then I think the Global Economic Meltdown has got something to do with Company's keeping quiet about their I.P.O's not many people will purchase shares in Companys. Then there is the issue os stock brokerage firms collapsing with investors money. I also think that many people who purchased Safaricom shares have not been refunded back their cash after the share allocations took place. The N.S.E is now very unpopular with Kenyans.
Mon Jul 06, 05:58:00 PM GMT+03:00I also think that Kiss/ Radio Africa is one of the most profitable media houses in the Country coz their employees e.g presenters drive big cars & live in posh estates which means that they are well paid. The media house has not only launched a T.V station, other radio stations have been/will be launched. I reckon that Kiss T.V will prove to be a popluar station & a successful one within a short time just like Classic & Kiss 100
Kenyans are wary of investing cash... but if you need cash, you need to tap the public markets...
Mon Jul 06, 08:26:00 PM GMT+03:00You might raise less by either selling fewer shares or at a lower price (re: Co-op Bank)...
For capital seekers, I think debt is generally more lucrative for now - then again isn't it always?
Mon Jul 06, 09:08:00 PM GMT+03:00In theory, good investors should realise the intrinsic value of a security so it shouldn't really matter if its an upturn or not; discount - they'l snap it up, premium - they'l pass. Perhaps these guys that intended to list really don't need the capital injection.
Personally, I'v had enough of the financials!!! Could we please have more industries?
From what i hear at Family Bank and Kenpipe, the Coop IPO under-performance (Nov/Dec '08) made other companies get cold feet about listing, and they will re-visit the matter when the market picks up.
Tue Jul 07, 09:21:00 AM GMT+03:00But also the massive expected government borrowing will attract a lot of fund and corporate investor interest, which may diminish their risk for equities in 09/10
@chegeprenuer: sure the conditions are bad for floating an IPO in kenya...but i've not heard of investors who never recieved their Safaricom refunds. Radio Africa would really be a great IPO.
Tue Jul 07, 12:05:00 PM GMT+03:00@coldtusker: fewer shares at reasonable prices (under priced) would still pull some investors. but alot of marketing would need to be done.
@V.A: We need more industries on this market. like health - what happened to the Resolution Health IPO and Education (some of these colleges rake in alot of profits)
@bankelele: government borrowig at good interest rates will subdue the NSE for a while. I still hold the notion that this is the perfect time to accumulate some undervalued stocks - long term.
Stock trading is no longer about long-term. Especially at the NSE
Tue Jul 07, 10:31:00 PM GMT+03:00It is all to do with the economic environment prevailing at the moment, and from the experience of Coop Bank IPO. The obvious reason why most company go public is to get cash and/or additional leverage opportunities. If by the outlook of things there are not enough members of public willing to offer the cash then they are well advised to be cautious. I think at the end IPOs silence from the companies and media is somehow justified. I bet their strategy is to wait until the economic environment becomes conducive and also for Kenyans to have faith again on the IPOs
Thu Jul 09, 07:31:00 PM GMT+03:00i read in the papers at the beginning of the year that IPOs were going to be fewer because of the economic crisis. I still dont understand why
Mon Jul 13, 10:33:00 AM GMT+03:00http://kenyantykoon.wordpress.com/
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