Welcome to RICH.CO.KE - Satchu's Wrapup

www.rich.co.ke Register and its all Free.

If you are tracking the NSE Do it via RICHLIVE and use Mozilla Firefox
as your Browser.
0930-1500 KENYA TIME
Normal Board - The Whole shebang
Prompt Board Next day settlement
Expert Board All you need re an Individual stock.

The Latest Daily PodCast can be found here
http://www.rich.co.ke/rctools/richpod.php

The Star KCB $200m Rights Issue
http://bit.ly/bWIYXv

Macro Thoughts

Watching and thinking of the Perturbation of a Single Butterfly's Wing.

Home Thoughts

I am reading VS Naipaul The Overcrowded Barracoon
http://www.jstor.org/pss/25612578

Suddenly the Tropical Daylight was gone and from the Garden came a
scent of a Flower. I knew the Flower from my Childhood; Yet I had
never found out its name. I asked now. ''We call it Jasmine.'' Jasmine
So I had known it all those years. To Me it had been a word in a Book,
a word to play with....

Karzai wants 2014 security handover Al Jazeera

Law & Politics

"I remain determined that our Afghan national security forces will be
responsible for all military and law enforcement operations throughout
our country by 2014," Karzai said.

White House shifts Afghanistan strategy towards talks with Taliban The Guardian
http://j.mp/cBZe5F

The Guardian has learned that while the American government is still
officially resistant to the idea of talks with Taliban leaders, behind
the scenes a shift is under way and Washington is encouraging Karzai
to take a lead in such negotiations.

"There is a change of mindset in DC," a senior official in Washington
said. "There is no military solution. That means you have to find
something else. There was something missing."

"The Afghan government is already talking to all the shareholders‚ the
Taliban, the Haqqani network, Gulbuddin Hekmatyar, and Mullah Omar.
The Americans have been setting ridiculous preconditions for talks.
You can't lay down such preconditions when you are losing."

Conclusions

Barack Obama, apparently frustrated at the way the war is going, has
reminded his national security advisers that while he was on the
election campaign trail in 2008, he had advocated talking to America's
enemies.

With McChrystal's Exit the President is beginning to Muscle Flex,
amongst his own Advisors.

A Piece I wrote for the Christian Science Monitor

Africa

The next #revolution is coming to #Africa Cellphones are bringing it
Christian Science Monitor http://j.mp/brcKqJ

Nairobi, Kenya

Revolutions typically happen dramatically. One day, the shah of Iran
is sitting pretty on his peacock throne, and the next, he is gone.

Revolutions have been happening all over the African continent and at
fairly regular intervals. The stories are numerous of coups and
countercoups, and it's not for no good reason that Africa has
typically sat at the bottom of the political stability indices. Even
here, though, there comes a point at which you cannot go any lower.
It's called "oversold." The political stability index for Africa has
bottomed out, in fact.

ECB Nearly Halts Government-Bond Purchases WSJ

World Of Finance

The European Central Bank nearly halted its purchases of public debt
last week, buying only €300 million ($387.8 million) in government
bonds, in the clearest signal yet that its program to support
vulnerable euro-zone countries is in its final stages.

Last week's bond purchases by the ECB represented the smallest amount
since the central bank started purchasing bonds issued by Greece,
Portugal and others on Europe's troubled periphery on May 10. After
buying more than €16 billion the first week, the amounts have steadily
dwindled, falling below €1 billion two weeks ago.

Conclusions

Philosophically They entered this Program Kicking and Screaming.
However, the Bona Fides of the Rebound in Yields are surely attested
to by the Speed of Retraction in this Program?
Aly-Khan Satchu
www.rich.co.ke

Currency Markets At A Glance WSJ

World Currencies

Euro 1.2966
Pound 1.5263
Dollar Index 82.49
Higher Beta
Aussie 0.8770
Rand 7.6163
Real 1.7914

The common currency sloughed off the downgrade of Ireland's credit
rating on Monday and the breakdown in funding talks between Hungary
and the International Monetary Fund over the weekend.

While uncertainty remains about the initial results from the stress
tests, due Friday, "on balance, people have become a bit optimistic,"
said Julia Coronado, economist at BNP Paribas in New York.

The Hungarian currency fell sharply and the cost of insuring Hungarian
debt surged Monday after the country failed over the weekend to reach
a funding deal with the International Monetary Fund and the European
Union.The euro shot up more than 3% against the forint to over 290
forints, taking the Hungarian currency back down to its lowest levels
in more than a year, as Hungary failed to deliver the austerity
measures required for it to receive the remainder of its existing €20
billion ($25.8 billion) standby credit line.

Conclusions

1.30 looks very Toppy but Fears of endemic US Weakness are overarching.

Apple May Report Profit Doubled on Demand for IPad, IPhone 4 Bloomberg

Information & Communication Technology

Apple Inc. will report that profit more than doubled last quarter,
analysts predict, reflecting demand for the iPad tablet and early
sales of the iPhone 4.

In a report later today, Apple may say net income in the fiscal third
quarter surged to $2.87 billion, or $3.09 a share, according to the
average estimate of analysts surveyed by Bloomberg. A year earlier,
the company said profit rose to $1.23 billion, or $1.35 a share.
Revenue likely surged 76 percent.

The results will give the first indication of the impact of the new
tablet, released April 3. Apple sold 3 million iPads in 80 days, a
sign Chief Executive Officer Steve Jobs is building a market for
tablet machines that deliver video, e-books and Web access. The period
includes three days of sales of the iPhone 4, which broke early
records even as it drew fire for a design flaw that results in
diminished call reception.

“The issue with Apple is high expectations,” said Shaw Wu, an analyst
at Kaufman Bros. LP in San Francisco who recommends buying the shares
and doesn’t own any. “The company is held to a very high standard,
both by users and the financial community.”

Apple share Price data Digital Look
http://j.mp/2DhKH7

Share Price     $245.58
52 Week High     $274.07
52 Week Low     $151.51
Shares Issued     909.94m
Market Cap     $223,463m
Beta     1.05
RiskGrade     151
Year Ending     Revenue ($m)     Pre-tax ($m)     EPS     P/E     PEG     EPS
Grth.     Div     Yield
24-Sep-05     13,931.00     1,808.00     164.00¢     32.4     0.1     +343%     n/a     0.0%
30-Sep-06     19,315.00     2,818.00     236.00¢     32.6     0.7     +44%     n/a     0.0%
29-Sep-07     24,006.00     5,008.00     404.00¢     38.0     0.5     +71%     n/a     0.0%
27-Sep-08     32,479.00     6,895.00     548.00¢     23.4     0.7     +36%     n/a     0.0%
26-Sep-09     36,537.00     7,984.00     639.00¢     28.5     1.7     +17%     n/a     0.0%

Conclusions

Worth Watching Developments.

Ivory Coast Rains Trigger Black Pod, May Curb Cocoa Production Bloomberg

Commodities

Weeks of heavy rainfall in south- western Ivory Coast, the world’s
biggest cocoa producer, triggered an outbreak of black pod disease
that may curb output of the beans, cocoa farmers and officials
said.Growers in the southwestern Soubre region, which accounts for
about quarter of the West African nation’s production, said output had
dropped because they lack the means to combat the spread of the
disease during the annual rainy season.The state-owned Fund for
Developing and Promoting Coffee and Cocoa Activities this season
planned to distribute chemicals to treat 550 hectares (1.36 million
acres), of which 225 hectares would also be sprayed with fungicides
that tackle black pod, spokesman Patrice Rox said in an interview on
July 13.

Cocoa production in the Ivory Coast is expected to rise to 1.3 million
tons in the year through September 2011 as higher prices prompt
growers to invest in their farms, the International Cocoa Organization
said on July 17.

The West African country produced 1.16 million tons in the 12 months
through September 2009, down 16 percent from a year earlier, according
to statistics from the country’s Bourse du Cafe et du Cacao.

Ghana, Indonesia and Nigeria are the world’s largest producers of the
chocolate ingredient, after the Ivory Coast.

Conclusions

Near optimal conditions for the Fellow with a $1b of Physical Cocoa to
squeeze the Price.

China Tops U.S. in Energy Use WSJ

China

China's ascent marks "a new age in the history of energy," IEA chief
economist Fatih Birol said in an interview. The country's surging
appetite has transformed global energy markets and propped up prices
of oil and coal in recent years, and its continued growth stands to
have long-term implications for U.S. energy security.

The Paris-based IEA, energy adviser to most of the world's biggest
economies, said China consumed 2.252 billion tons of oil equivalent
last year, about 4% more than the U.S., which burned through 2.170
billion tons of oil equivalent. The oil-equivalent metric represents
all forms of energy consumed, including crude oil, nuclear power,
coal, natural gas and renewable sources such as hydropower.

China overtook it at breakneck pace. China's total energy consumption
was just half that of the U.S. 10 years ago, but in many of the years
since, China saw annual double-digit growth rates. It had been
expected to pass the U.S. about five years from now, but took the top
position earlier because the global recession hit the U.S. more
severely, slowing American industrial activity and energy use.

Mr. Birol, formerly an economist at OPEC, said China is expected to
build some 1,000 gigawatts of new power-generation capacity over the
next 15 years. That is about equal to the current total
electricity-generation capacity in the U.S.—a level achieved over
several decades of construction.

Conclusions

"A new age in the history of energy."

Nakheel Yields Double 2007 Show Closed Market: Islamic Finance Bloomberg

World Of Finance

Dubai World-owned Nakheel PJSC’s Islamic bonds are trading at yields
twice as high as in 2007 even after a four-month rally, underscoring
the difficulty for Persian Gulf real-estate companies to borrow
through debt sales.

“Access to the market is still difficult for companies operating in
the real-estate sector,” Mohamed Damak, Paris- based credit analyst
and co-chair of the Islamic finance working group at Standard &
Poor’s, said in an interview yesterday. “The market is somewhat closed
for these entities.”

The yield on Nakheel’s 2.75 percent sukuk fell to 15.4 percent
yesterday from 86 percent on March 25, when Dubai’s government said it
would support the company with $9.5 billion, according to prices
compiled by Bloomberg. Nakheel, a builder of palm-shaped islands off
Dubai’s coast, is a unit of Dubai World, the world’s third-largest
port operator.

“There is ample proof that market conditions are still not conducive
for sukuk issuance,” Ahmad Alanani, the London-based associate
director for the Middle East and North Africa at Exotix Ltd., an
investment bank specializing in illiquid bonds, loans and asset
management, said in an interview on July 18. “There are a multitude of
companies who would like to issue sukuk but the market remains closed
to non-sovereign linked issuers.”

The yield gap between the Dubai Department of Finance’s 6.396 percent
sukuk maturing in November 2014 and Malaysia’s 3.928 percent Islamic
note due June 2015 has widened 22 basis points to 429 basis points in
the past week, according to data compiled by Bloomberg.

Conclusions

“Only the strongest sovereigns can borrow at ‘reasonable’ rates,”
Howladar said. “From what may have been a shaky start they seem to be
doing all they reasonably can to encourage transparency and orderly
resolution with creditors.”

Even after the Rally, Nakheel trades at 15.4%. Thats still a Bust.

Equity Bank share price data from www.rich.co.ke 1st Half Results

N.S.E Equities - Finance & Investment

Par Value: 0.50/-
Closing Price: 23.75
Total Shares Issued: 3,702,777,088
Market Capitalization: 87,941M
EPS: 1.14
PE: 20.833

Profit and Loss after Tax and Exceptional Items 3.010396 Billion
versus 2.097228 +43.54%

Assuming this Run rate = 3.010396b x 2 = 6.020792b / 3.702777088b =
1.626 per share Full Year Projection

23.75 / 1.626 = 14.606 Implied Full Year Forward

Conclusions

Price has further Head Room.

Kenya's Equity Bank H1 profit up 46 pct,sees growth Reuters
http://bit.ly/cmVkno

Kenya's Equity Bank posted a 46 percent rise in first-half pretax
profit on Tuesday and its chief executive forecast earnings would rise
further on easing costs and economic growth in the region.Equity,
which has operations in neighbouring Uganda and Sudan, said profit
rose to 3.88 billion shillings during the first six months of the
year.Depositors jumped by 400,000 to nearly five million, mainly due
to a new mobile phone service called M-Kesho, run jointly with Kenya's
biggest mobile operator Safaricom, which allows users to access
credit, earn interest on deposits and buy insurance. .

Equity's CEO James Mwangi told investors the bank's recent expansion
costs had started to taper off and combined with better economic
growth prospects in the region this signalled further profit gains.

"The profitability of the bank is likely to accelerate because of
costs. Most of the costs are now fixed," Mwangi said.

Equity's loan book expanded by just over a quarter during the period
while bad debt provisions rose 211 percent to 920 million shillings to
clean out the threat of defaults, Mwangi said.

Tourism set for record year as arrivals peak Business Daily

Kenyan Economy

The tourism sector is set for a record year as arrivals over the last
five months surpass the peak levels of 2007, signalling that the
industry has made a turnaround.Data from Kenya Tourist Board (KTB)
shows that arrivals in the first five months grew 20.5 per cent to
403,996, moving beyond the 2007 levels when Kenya posted its best
performance with 400,362 arrivals over the same period.In 2007, the
country earned Sh63.5 billion from 1, 048, 732 tourists, but the
momentum was halted by the bloody post election turmoil in January
2008 and the global recession that cut travel budgets.

In 2008, the sector earned Sh52.7 billion from 729,000 tourists before
rising to Sh62.5 billion last year when arrivals rose to 952,481.

“All things being equal, this year should see a record performance and
set the stage for a fresh growth trajectory similar to the period
between 2003 and 2007, seeing that the arrivals have overtaken the
2007 benchmark year,” KTB chairman Jake Grieves-Cook, said.

Though the earnings estimates for the period under review are not yet
available, they are expected to be high due to the Sh13.3 billion
recorded in the first two months which was double the earnings of a
similar period in 2009.

Conclusions

TPS Serena is a good highly correlated Proxy.

TPS Serena share price data from www.rich.co.ke

N.S.E Equities - Commercial & Services

Par Value: 1/-
Closing Price: 58.50
Total Shares Issued: 123,508,864
Market Capitalization: 7,225M
EPS: 3.60
PE: 16.250

Mahmud Jan Mohamed Serena Mindspeak Presentation
http://j.mp/3kIwjf

My Tweets from that Presentation

#mindspeak Serena we turned down Biden Serena Williams a wonderful
Guest www.rich.co.ke via mobile web
#mindspeak Serena The only real Kenya Multinational www.rich.co.ke
#mindspeak Serena Jan Mohamed world wide turnover $160m www.rich.co.ke
#mindspeak I expand in order to stop myself being run over Mahmud Jan
Mohamed Serena Hotels
#mindspeak Jan Mohamed #Africa Expansion Serena amount of Africa
Business stunning Looking at South and West Africa #Serena
#mindspeak Jan Mohamed talking about #technology $2m last 4 months via
Internet Peanuts before www.rich.co.ke
#mindspeak Serena Kabul hosted Security Council 1st time
#mindspeak Describing Terrorist attack and his reaction Kabul Serena
#mindspeak Jan Mohamed #Serena Encourage Messengers of Bad News
#mindspeak What did British Airways do after the Sleeper Seat ?
#mindspeak Jan Mohamed #Serena New Product Serena Collection
#mindspeak Start Up Rising Star Cash Cow Dead Dog or Rising Star
Westgate #Mindspeak #Nairobi Real Time Location www.rich.co.ke
http://twitpic.com/201bgi

Amboseli Serena
http://j.mp/bqI3Dk

N.S.E Equities - Commercial & Services

SAFARICOM

shares volume     7.366m
total turnover     42,248,680
avg price     5.84 Closing Price 5.80
high price     5.90
low price     5.55
last price     5.55

Conclusions

Very Curious Price Action today. We actually traded 5.55 -5.13%
session low into the Close. Clearly, someone is trying to manouevre
the Price. Safaricom was the most active Counter at the Bourse as per
my Twitter Posse is set to announce the Launch of the Google Android
Phone, Imminently.

TPS Serena closed at 59.00 [a new Closing High for the Year when you
factor in the Bonus shares] and traded 11,500 shares.

Kenya Airways eased 1.58% to close at 46.50 and traded 25,600 shares.

Access Kenya traded 56,100 shares and shaved off 25 cents to close at 20.25.

Nation traded 6,700 shares at 143.00 unchanged.
Standard traded 200 shares at 38.50.

CMC Holdings traded 6,900 shares only 20 cents lower at 12.65.
CarGen did not trade.

N.S.E Equities - Finance & Investment

The Big Cap Banks continue to outperform and Equity Bank's 1st Half
Results today encouraged Buyers again.

Equity Bank reported 1st Half results Pre Opening this morning. Equity
Bank increased Profit after Tax 43.54% and surpassed Consensus
Estimates which will now play catch up. Equity Bank firmed 1.05% to
close at 24.00 and traded a 24.00-24.50 range and 1.214m shares worth
29.359m. The Price is well underpinned. This is a 23 Month Closing
High. Equity Bank comments to Reuters http://bit.ly/cJqSao

Aly Khan Satchu, an independent analyst said: "Equity delivered
further confirmation that the earnings curve has inflected and
continues to steepen... this without the M-Kesho transactions kicking
in," said

"Investors might tend to the view that the fixed cost infrastructure
is now in and the forward earnings curve set to flow dynamically to
the bottom line."

COOP Bank was the 3rd most actively traded Counter. COOP Bank firmed
0.68% to close at 14.75 and traded a 14.65-15.00 range and 1.781m
shares worth 26.314m. 16.00 is the all time Intra Day High for COOP
Bank.
KCB firmed 0.2833% to close at 17.80 and traded a 17.75-18.00 range
and 1.107m shares worth 19.72m. We are at a Base in the Price.
Barclays Bank firmed 0.72% to close at 69.50 and traded a 69.00-70.00
range and 204,000 shares worth 14.201m. This is a 2 Year Closing High.
Stanchart firmed 1.66% to close at 244.00 and traded a 241.00-250.00
range and 7,100 shares. This is a 3 and a half Year Closing High. The
All time Closing High was 257.00 on January 2007.

CFC StanBic closed unchanged at 84.50 and traded a 82.50-88.00 range
and 49,200 shares.
DTB firmed 1.1% to close at 91.50 and traded 4,500 shares.
HFCK firmed 1.16% to close at 21.75 and traded 88,000 shares.
NBK firmed 1.3% to close at 39.00 and traded 47,800 shares.
NIC was marked down to close at 38.25 on 17,500 shares traded.

Centum eased a further 2.44% to close at 20.00 and traded a
19.75-20.50 range and 42,600 shares. Centum traded EX from yesterday
and hence the draw down.

Kenya Re retreated 0.8646% to close at 11.35 and traded 154,400 shares.
Jubilee traded 200 shares at 163.00 -1.21%.
PanAfric did not trade.

Olympia Capital closed at 7.40.

N.S.E Equities - Industrial & Allied

KenolKobil retreated 2.8275% to close at 10.30 and traded a
10.10-10.50 range and 403,900 shares worth 4.714m. I did not attend
the Press Conference yesterday but a Friend told me, It marked a Step
Up in the Language and the War with the Ministry. Tank Storage
Magazine is saying that KenolKobil has incurred penalties of over $3
million (€2.32 million) for delays in off-loading imported fuel at the
Kipevu Oil Storage Facility in Mombasa, Kenya, which is confirmation
of the where this Contretemps can go.
Total traded 3,000 shares at an unchanged 29.50.

KenGen rallied 0.87% to close at 17.55 and traded a 17.40-17.90 range
and 245,600 shares.
KPLC was marked down 1.53% to close at 195.00 and traded 2,200 shares.

East African Cables bounced 2.9% to close at 19.50 with 84,300 shares
traded after its 13%+ sell off yesterday on its Profits Warning.

Mumias Sugar rose 0.4% to close at 12.60 and traded a 12.55-12.75
range and 840,200 shares worth 10.592m.

Unga bounced 5.85% to close at 12.65 and traded 18,100 shares.

EABL was unchanged at 180.00 and traded a 180.00-184.00 range and
54,900 shares worth 9.918m. 184.00 is a new 12 Month Intra Day high.

BAT firmed 1.29% to close at 239.00 and traded 600 shares. Sellers are
Nowhere to be found. BAT traded a 245.00 Intra Day Session High which
is a new 12 Month Intra Day High.

Bamburi Cement traded a 100 shares at 200.00 +1.52%.
ARM was unchanged at 141.00 and traded 18,200 shares.
Portland did not trade.

BOC Kenya did not trade.
Carbacid rose 2.05% to close at 149.00 and traded 700 shares.
Crown Berger traded unchanged at 32.50.
Eveready was marked down 3.69% to close at 3.90 and traded 46,700 shares.
Sameer closed lower at 8.30 and traded 98,100 shares.