Black Affairs, Africa and Development

Centum Investments Tops Best Performers For 2013 On NSE

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Shareholders of investment firm Centum closed the year nearly three times richer as the company topped the best performers’ list on the Nairobi Securities Exchange (NSE) in 2013.

The share price on the counter surged 167 per cent to Sh33 as the curtain fell on 2013, compared with Sh12.35 as at the end of 2012.

Overall, the bourse closed higher than last year, with the NSE 20 share index, the measures of performance of the most traded firms on the bourse, rising by 19.2 per cent to close at 4926.97 points, compared with 4133.02 points posted at the close of 2012.

Equity turnover, on the other hand, rose by 80 per cent to Sh155 billion from Sh86 billion posted in 2012. Annual trading volumes increased by 40.7 per cent to 7.6 billion shares from 5.4 billion shares posted in 2012.

Centum was in the news much of 2013 year, owing to announcements on acquisitions or proposed acquisitions of other companies, a move that has seen strong investor appetite on the counter.

“There has been a lot of corporate activity on the counter. There have been announcements on acquisitions and proposed acquisitions of other firms, which have seen the share price go up,” said Mr Mika Davis, an analyst at Contrarian Investing.

The latest move was the revelation of a Sh5 billion war chest to buy out Rea Vipingo Plantations. This followed an earlier bid of Sh3 billion being outmatched by Bid Investments, which said it would offer Sh3.3 billion to acquire the sisal firm.

The firm, which has interest in real estate sector and investments listed on the stock market, acquired a 45 per cent stake in Platcorp in 2012, with plans of venturing into East Africa’s financial services sector.

This was in addition to a move to acquire a 73.35 per cent in Genesis, an investment management services firm that manages funds worth over Sh100 billion.

Shareholders of other firms including Britam, Liberty Holdings, Pan Africa Insurance, Safaricom, Carbacid, CFC Stanbic, Housing Finance and Athi River Mining also saw the value of their shares more than doubling in 2013.

“Investment companies like Centum, TransCentury, Carbacid and insurance companies like Britam have recently shifted gears, with ambitious investment strategies in real estate, oil and gas, mining, agribusiness, tourism and infrastructure.

This has led to renewed interest in these firms by the investment community as they seek to be part of the expected growth opportunities,” noted Mr Samuel Gichohi, NIC Securities business development manager.

Mumias Sugar closed the year as the worst performing counter, with the share price declining by 32 per cent to Sh3.25 per share, compared with Sh4.85 at the end of 2012.

The firm has been hit by a series of setbacks, including recording the lowest sugar production level in five years. It has also been hit by cane poaching from rival millers, declining quality of cane and diminishing cane acreage in its growing zone in western Kenya.

Scangroup was the second worst performer of the year even as the firm, in December, announced the completion of a Sh1.8 billion deal that would see it acquired by WPP, a global communications firm.

It reported disappointing results in the first half of 2013 with profit after tax falling to Sh43 million in the six months to June 2013, compared with Sh403 million reported in the same period last year.

The firm’s share price declined by 29.56 per cent at the end of 2013 to Sh48.25 per share from Sh68.5 recorded at the end of 2012.

The bonds market closed 2013 on a low note, having declined 14.5 per cent to Sh453 billion compared with Sh530 billion posted at the end of 2012, according to the NSE report.

Market capitalisation rose by 51.2 per cent to Sh1.92 trillion as at the end of 2013, compared with Sh1.27 trillion posted at close of 2012.

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