This was the first time Eveready share has hit the level since March 2010, and was up 78 per cent on Monday’s closing price of Sh2.75.
The firm saw brisk trading Tuesday with 1.29 million shares exchanged, without the usual 10 per cent gain or loss limit on the counter following the significant corporate announcement made during trading hours on Monday.
Eveready climbed to a four-and-a-half year high of Sh4.90 Tuesday as investors took a positive view of the company shutting down its battery manufacturing plant to concentrate on real estate.
The counter touched Sh5 Tuesday in the first session of trading since the closure was announced. This was the first time it has hit the level since March 2010, and was up 78 per cent on Monday’s closing price of Sh2.75.
The Naushad Merali-associated firm saw brisk trading Tuesday with 1.29 million shares exchanged, without the usual 10 per cent gain or loss limit on the counter following the significant corporate announcement made during trading hours on Monday.
In shutting down its Nakuru plant, Eveready cited decline in the dry-cell battery market due to cheap imports and high energy costs which have reduced its capacity to 25 per cent.
In the battery line, the company will now transform into a distributor of readymade imports sourced from the affiliate of the US firm Energizer in Egypt. It joins a long queue of manufacturers including US pampers vendor Procter and Gamble that took the same option 13 years ago.
“The decision was informed by the 20-acre prime location on which the factory sits as this will be the site for the company’s flagship investment. Kenyan developers have in the past witnessed double-digit returns driven by increased demand for residential and commercial properties,” said Standard Investment Bank in a note following Eveready’s announcement.
Longhorn, Jubilee Holdings, Kenya Orchards and Unga were the other main gainers Tuesday, in a day smaller counters dominated the market.
Jubilee closed 9.5 per cent up at an all-time high of Sh486 though on low volumes, continuing its recent cash-call defying gains.
Kenya Orchards, following an announcement that it will be moving into manufacturing of spices as it expands its food processing portfolio closed 8.9 per cent higher at a fresh all-time high of Sh73.
Longhorn was up 8.5 per cent to touch a new high of Sh25.75.
The publisher is still benefitting from investor demand arising out of the announcement of an improved dividend (up 150 per cent to Sh1.20) and news of positive growth prospects for the regional business.
Unga Group also closed at an all-time high price, gaining 8.6 per cent to Sh40.75.
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