The Uchumi Supermarkets share has shed 29.7 percent of its value in the last one week, handing investors who accumulated the stock at the peak of its recent rally a loss of Sh200 million on their holdings.
Uchumi closed at Sh1.30 per share on Tuesday, down from Sh1.85 per share a week ago, having fallen by between 9.4 percent and 9.7 percent in each of the last three trading sessions.
In the preceding four weeks, Uchumi was the fastest rising counter at the Nairobi Securities Exchange (NSE), rallying from Sh0.38 per share on November 11 after a disclosure that the company had made a rare profit of Sh8.8 million for the year ended June 2025.
The profit marked a reversal of a loss of Sh47.9 million in June 2024, as per disclosures in management accounts under Uchumi’s Company Voluntary management (CVA) framework.
The announcement of the profit triggered a buying frenzy on the share as speculators bet on the prospects of a turnaround at the company, despite its negative equity position and uncertainties over ownership of key assets such as land holdings.
As a result, the stock price rose fivefold from Sh0.38 on November 11 to Sh1.85 on December 9, before the price correction kicked in to pull it down to the current level.
The rally had handed investors a paper gain of Sh536.5 million at the peak price of Sh1.85 per share, with the company’s market capitalisation (the measure of investor wealth) rising to Sh675.2 million from Sh138.7 million. By the close of trading on Tuesday, Uchumi had a market valuation of Sh474.4 million.
This week, demand for the shares has also fallen, while the volumes supplied by those scrambling to offload their units have gone up.
In Tuesday's session, investors traded 293,309 shares, but by close of trading the market had outstanding sell orders of about 5.06 million shares and no outstanding bids. At the peak of the rally on December 9, investors traded 4.39 million shares on the counter.
The price and demand swings illustrate the volatility of small stocks at the NSE, as well as the impact of material announcements on the performance of companies at the market.
In the case of Uchumi, the rally was triggered by the disclosures of the CVA report, prepared by Owen Koimburi of the business advisory firm Forvis Mazars Kenya, which showed that the company’s sales revenue rose from Sh63.5 million in the year to June 2024 to Sh123.01 million in the year to June 2025.
Uchumi’s biggest boost came from rental income, which was up five times to Sh62.7 million from Sh13.5 million in June 2024, largely driven by low cost household goods retailer China Square which leased the company’s Lang’ata Hyper Branch from June 2024.
As per the CVA disclosures, Uchumi has 11 tenants paying it a monthly rent of Sh5.94 million.
China Square pays Sh5 million or 84 percent of the monthly rental collections, followed by Paris Lounge Grill (Sh300,000), Isle Garden (Sh212,155), Sudo Liquor Store (Sh114,223) and Spatial Barberz (Sh64,655). The CVA was set up in March 2020 to guide the company’s settlement of debt over a six-year period ending June 2026.
The latest report shows that the company has managed to pay 95 percent of the Sh245.9 million in debt it had planned to settle by the end of the period, with banks taking up the lion’s share at Sh146.5 million, followed by trade creditors and landlords at Sh9.84 million and staff salary arrears at Sh6.83 million.
