EABL share hits a high even as keg tax set to rise Tuesday
The keg line at the EABL plant in Ruaraka, Nairobi. The firm recorded a 37.9 per cent drop in profit after tax for the full year ended June to Sh6.9 billion. FILE
What you need to know:
The East Africa Breweries share has gained 17 per cent on the Sh282 as at the beginning of September to touch a high of Sh335 on Monday.
EABL goes ex-dividend Tuesday on the same day its tax advantage on the high revenue keg draft is cut by half.
The East Africa Breweries Ltd (EABL) share continued with its recent ascent Monday to hit Sh329 on the back of sustained foreign investor demand and impending closure of its register.
EABL, however, goes ex-dividend Tuesday on the same day its tax advantage on the high revenue keg draft is cut by half.
The share has gained 17 per cent on the Sh282 as at the beginning of September to touch a high of Sh335 on Monday, before settling at Sh329 or Sh10 up.
EABL remains the second-largest company at the Nairobi Securities Exchange by market valuation, standing at Sh260 billion. The value has risen by Sh37 billion during the month of September.
“The gain in the recent weeks can be attributed to the Sh4 dividend, with books closure on September 30 as investors continued to take positions as they chased the dividend. We are likely to see a mild fall after books closure today (Monday),” said ABC Capital research analyst Duncan Lumwamu.
“However, with the restructuring taking place, both in medium term and long term, investor confidence will sustain price momentum.”
Suntra Investment Bank head of research Johnson Nderi said that the closure of books is a factor in the price rise, but of importance is the outlook from investors.
“Many of the investors coming into the counter are medium to long term investors, looking to hold onto the share longer,” said Mr Nderi.
The gain in the EABL share, coupled with that of Safaricom and KCB, the largest and third biggest companies by valuation in the bourse respectively, has underpinned the rise on total market capitalisation from Sh1.68 trillion at the end of August to Sh1.79 trillion today.
Safaricom closed trading Monday at Sh8.50 per share, matching its all-time high closing price and bringing its capitalisation to Sh340 billion. KCB maintained its all-time high closing price of Sh46.50, with valuation at Sh139 billion.
The Safaricom and KCB counter valuation stood at Sh308 billion and Sh124 billion respectively at the beginning of September.
The brewer, which is controlled by UK Diageo Plc, recorded a 37.9 per cent drop in profit after tax for the full year ended June to Sh6.9 billion having already issued a profit warning on the same in July.
PAYE Tax Calculator
Note: The results are not exact but very close to the actual.
