Safaricom reclaims position as NSE’s most valuable firm

Safaricom has risen to the most valuable company at the stock market, dethroning East African Breweries Limited, whose share price took a hit from a drop in the beer maker’s half-year profit and subsequent exit of its CEO.

Safaricom has the highest number of listed shares at the stock exchange (40 billion), and the increase in price from Sh5.45 at the end of January to Sh5.75 at the end of February translated into an increase of its market capitalisation from Sh216.5 billion to Sh234 billion at the end of February.

On the other hand, EABL shed Sh9.6 billion during the month. The brewer was valued at Sh236.5 billion at the beginning of the month, and was down to Sh226.9 billion at the end of February.

Eric Musau, a markets analyst at Standard Investment bank, attributed Safaricom’s appreciation to anticipation of good financial results for the company and linked EABL’s drop to profit taking by investors after a sustained price rally ahead of the results announcement.

“The fall in price after a stock touches a high like EABL did recently is normal. On Safaricom, we expect good numbers, and this has helped the price to inch up,” said Mr Musau.

EABL’s share price declined 6.3 per cent in February, a difficult month in which the company announced a half-year after tax profit fall of 14 per cent and the announcement of MD Devlin Hainsworth’s exit to be replaced by Charles Ireland on April 1.

The company’s profits fell to Sh3.76billion for the six months ending December 2012 compared to Sh4.389 billion in the corresponding period in 2011.

KCB remained the third most valuable company at the Nairobi Securities Exchange (NSE) just like it was in January, and rode on a 14 per cent price increase of its shares lifting its capitalisation from Sh98.8 billion to Sh115.6 billion in the month of February.

Its counter was also the second heaviest traded, with deals worth Sh2.4 billion recorded in the month.

EABL was February’s biggest mover with shares worth Sh4.7 billion changing hands. Safaricom was third with deals worth Sh2.21 billion recorded in the month.

Access Kenya led the list of top 10 gainers in the market in February, with its price climbing by 25 per cent to Sh6.50 in the month, which compared to its price in February 2012, represents a 47.7 per cent gain.

Other top movers were ARM which gained 19.2 per cent, East African Portland Cement which gained 17.2 per cent and PanAfrican Insurance which gained 17 per cent.

The biggest loser in the month was Mumias sugar which shed 16.8 per cent of the value of its share to close the month at Sh4.20, representing a drop of 13.4 per cent of its value compared to February 2012.

Others counters which shed significant value were Marshalls East Africa which lost 11.7 per cent of its value to close at Sh9, and Longhorn Kenya which lost 11.43 per cent.