Investor moves Sh6 billion NMG shares in block trade

A block trade of 19.5 million Nation Media Group (NMG) shares dominated trading at the stock market on Wednesday, with the counter accounting for 90 per cent of market turnover.

The single trade of Sh5.99 billion, which market dealers described as a portfolio re-alignment by one of the top-ten shareholders of the media group, was done at Sh313 per share. It lifted total turnover at the bourse to Sh6.6 billion.

Market analysts said investor interest in NMG shares is expected to remain strong based on expectations of high growth of advertising expenditure as companies that had frozen marketing budgets prior to the General Elections raise their spending.

“Strong economic performance in the East African region should see increased ad spend as consumer, telecoms and financial companies amongst others increase their advertising budgets on account of improved performance and as they seek visibility in the highly competitive environment,” said a coverage note by Kestrel Capital.

The Nation Media Group is majority owned by the Aga Khan Fund for Economic Development (Akfed), which held 44.66 per cent of the stock as per shareholding information published in the annual statement for up to December 2012.

Amin Nanji Juma is the second-biggest shareholder controlling 9.98 per cent of the stock, while the National Social Security Fund has a 2.9 per cent interest in the company.

John Kimani is listed as the fourth largest shareholder controlling 1.31 per cent, while Jubilee Insurance Company of Kenya is fifth with 1.08 per cent shares as per the annual report.

Stockbrokerage firms could not disclose the investor behind the big trade, citing corporate governance rules that prohibit traders from revealing client information. They, however, confirmed it was not a trade by Akfed.

The NSE 20-Share Index dropped 11.24 points to 4,199.06, in tandem with a general drop in share prices of stocks that constitute the indicator. But the Nairobi All Share Index rose by 0.49 points to close at 125.31 points.

Market capitalisation increased by Sh8 billion from Sh1.762 trillion to Sh1.754 trillion recorded a day earlier.

Analysts said there has been a mix of results in share price movements, reflecting half-year performances of listed firms.

Johnson Nderi, the head of research at Suntra Investment Bank, said investors are taking a wait-and-see approach to get a clearer direction of the interest rates movement.