A member of staff at the Nairobi Securities Exchange (NSE) monitors online trading. Strong demand has lifted NSE, Equity and Britam shares to historic highs. PHOTO | SALATON NJAU | NATION
What you need to know:
Equity Bank share price touched Sh54, Britam Sh30.50 while the NSE share closed at a weighted-average price of Sh23.50 compared to the Sh9.50 initial public offering (IPO) price.
High demand for Britam, Equity Bank and the Nairobi Securities Exchange (NSE) stocks has helped push the prices to historic highs. Shares in the three firms touched 52-week highs in yesterday’s trading, buoyed by rising demand from local retail and institutional investors.
Equity Bank share price touched Sh54, Britam Sh30.50 while the NSE share closed at a weighted-average price of Sh23.50 compared to the Sh9.50 initial public offering (IPO) price.
Traders said Britam’s recent acquisition spree and its going heavy into sectors such as real estate had struck the right chord with investors.
“As much as it is an insurance company, it is turning out to be an investment company,” said Alistair Gould, head of trading and business development at Old Mutual Securities.
Britam has a 10.1 stake in Equity Bank which means that shares in the two companies will likely move in the same direction. The insurer has disclosed its intention to increase shareholding in Kenya’s largest bank by customer numbers.
Demand for Centum shares has also risen as the company expands to sectors such as real estate, energy and financial services by either buying out or buying into other firms. Centum share price touched a historic high in last week’s trading buoyed the firm’s recent acquisition.
The investment firm announced that it had bought a 30 per cent stake in Broll, a property management firm.
“Other than property development, the firm also does project management and brokering. Centum recently clinched a coal power contract to set up Kenya’s largest power plant in Lamu. This news saw the share price hit a bull run with the counter having reached an all-time high of Sh61,” said a market report by Sterling Capital. Prior to the Broll investment, it had bought Genesis Kenya for Sh1 billion and made a takeover bid for Rea Vipingo.
The Kenya Association of Stockbrokers and Investment Banks (Kasib) said the strong performance of the NSE so far is also making investors opt to reinvest refunds in other counters.
“The positive response from the IPO is encouraging other investors to come back and invest in other counters,” said Kasib chief executive Willie Njoroge.
Foreign investors have mainly dominated the stock market, but local investors have started buying as share prices go up.
Mr Gould echoed Mr Mwangi’s sentiment, adding that the NSE’s continued rise had ushered back investors to stocks, helped by uncertainty in the debt markets. The NSE 20-Share Index has gained from the 4,9710.74 points it opened the year with to 5,182.28 points.
