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Satchu's Rich Wrap-Up
 
 
Monday 03rd of May 2010
 
Morning
Africa

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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


I do thank Eleni Giokos for this Interview carried today on #CNBC


Kenya Africa Markets
http://bit.ly/cXyMoK

Macro Thoughts

1.2980 Euro Dollar.
Gold 1225.
Sugar might have based out.
Stay Long Africa Equities 2010.
Safaricom 6.60 Objective.

Home Thoughts

We had a dreamy and beautifully exquisite weekend in the Amboseli. The
Driver Hashim did not take the Namanga Turn off but took the Emali one
and the road was as smooth [as a Babys Bottom] as I have ever
witnessed in my lifetime. As we entered the Park, we gave way to a Big
Bull Elephant and it must have been all of 50 feet in front of us.
Suddenly there are Roars and we realise the Elephant has nearly stood
on 2 Sleeping Male Lions. We would have missed the Lions otherwise. We
stayed at the Serena and all of us thoroughly enjoyed ourselves. We
saw a herd that must have been more than a 100. As You drive to the
Serena, there is a deserted Lodge. Monkeys are everywhere, it is a
little spooky.

The Curious thing was I recalled waking in the Middle of the Night
some 35 Years ago. I was on the Train from Mombasa going to Nairobi
and I still have Emali printed on my Mind. Late at Night the noises of
a Train Station.

Wild White Flowers The Road from Emali to Amboseli
http://www.twitpic.com/1k9l0k

Somewhere The Nairobi Mombasa Road
http://www.twitpic.com/1kajie

The Driver told me these Two Lions were Honeymooners
http://www.twitpic.com/1jyw7z

Can you see the Girl Friend in the back ground. She had just gotten
short shrift.

read more


Will the Real Avatar Please Stand Up by Woody Allen New Yorker
Misc.

I suppose gods in human form may well have dropped in on this blue
marble from time to time, but I strongly doubt that one has ever
tooled around Rodeo Drive in a T-bird with the aplomb and good looks
of Warren Beatty. Reading “Star,” the new biography by Peter Biskind,
one can’t help but be blown away by the actor’s overwhelming
accomplishments. Think of the movies, the grosses, the reviews, the
Oscars, the endless nominations springing from this quadruple-threat
voracious reader and marketing maven, who is nimble at the Steinway,
savvy in the ways of politics, and a full-time Adonis, with accolades
accruing from divers ones who believe he belongs not just up on the
silver screen but in the Oval Office.

read more


Hunt for bomber who targeted the heart of New York The Independent
Misc.

The most audacious terrorist attack on New York since September 11th
may have been foiled by "amateurish" bomb-making equipment and a
quick-witted t-shirt salesman who alerted police to a car which had
been filled with explosives and parked a couple blocks from Times
Square, the city's busiest tourist district, on Saturday night.

.A group calling itself the Pakistani Taliban group released a video
last night claiming responsibility for the potentially-devastating but
ultimately failed attack, which saw a Nissan SUV packed with propane
tanks, petrol, and fireworks, and left a few blocks north of the
always-bustling square.

Though smoke began pouring out of the vehicle at around 6.30pm, the
bomb failed to detonate, and security teams successfully disarmed it
after clearing tens of thousands of tourists and revellers from the
surrounding streets. In a tape released on a militant website, the
Taliban group nonetheless hailed: "a jaw-breaking blow to Satan's
USA."

Conclusions

Its all very asymettric.

Aly-Khan Satchu
www.rich.co.ke

read more


Greece Gets $146 Billion Rescue on EU, IMF Austerity Package Bloomberg
World Of Finance

Euro-region ministers agreed to a 110 billion-euro ($146 billion)
rescue package for Greece  to prevent a default and stop the worst
crisis in the currency’s 11-year history from spreading through the
rest of the bloc.

The first payment will be made before Greece’s next bond redemption on
May 19, said Jean-Claude Juncker after chairing a meeting of
euro-region finance ministers in Brussels yesterday. The 16-nation
bloc will pay 80 billion euros at a rate of around 5 percent and the
International Monetary Fund contributes the rest. Greece agreed to
budget measures worth 13 percent of gross domestic product.

Conclusions

The Show Me the Money Moment.

read more


Bets Versus Euro at Record as Traders See Past Greece Bloomberg
World Currencies

Hedge funds and other large speculators raised net wagers on a euro
drop by 25 percent to 89,013 contracts in the week ended April 27,
Commodity Futures Trading Commission data shows. The euro dropped to
$1.3233 at 11:08 a.m. in Singapore after falling to a one-year low of
$1.3115 on April 28 as Standard & Poor’s lowered Greece’s debt to junk
and cut Portugal and Spain.

While Greece accepted a bailout from the European Union and
International Monetary Fund valued at 110 billion euros ($146 billion)
to prevent default, futures-market bets show traders expect any gains
to be short-lived. The euro has depreciated 7.6 percent this year,
including last week’s 0.7 percent loss, as concern the sovereign debt
crisis will slow Europe’s economy reduced confidence in a region whose
$13.6 trillion gross domestic product is exceeded only by the U.S.

“Greece is a Lehman Brothers for the sovereign world.”

The extra yield  investors demand to hold Greek debt over German bunds
surged to 826 basis points on April 28 after Standard & Poor’s cut its
rating to junk. It shrank to 594 points April 30.

Conclusions

1.2980

read more



Athens Composite Index Bloomberg Visual
World Of Finance

Value1,869.99   
Change40.700    
% Change2.225

read more


Currency Markets at a Glance
World Currencies

Euro 1.3238 - I continue to look for 1.2980
Pound 1.5254
Dollar Index 82.15.
Higher Beta
Aussie 0.9249 - 0.93 remains the Pivot
Real 1.7387
Rand 7.3803

Conclusions

I cannot see the Euro holding onto any Relief Rally Gains.

read more



Louis Vuitton Tops Hermes, Gucci as Most Valuable Luxury Brand Bloomberg
Retail & Manufacturing

Louis Vuitton, the French fashion brand known for its monogrammed
luggage, topped Millward Brown Optimor’s 2010 BrandZ  ranking of the
most valuable luxury labels for the fifth straight year.

The brand, owned by Paris-based LVMH Moet Hennessy Louis Vuitton SA,
has a value of $19.8 billion, up 2 percent on 2009, ranking it 29th
worldwide across all industries, according to the study released
today. That’s more than the combined value of rival labels Hermes and
Gucci, which placed second and third in the luxury standings and
ranked 86th and 97th overall.

LVMH Moet Hennessy Louis Vuitton SA Bloomberg
http://bit.ly/9Kgwhn

Price86.840
52-Wk High (04/13/10)92.360   
52-Wk Low (07/08/09)52.750   
1-Yr Return55.227
Earnings3.710   
Price/Earnings23.407

Conclusions

There is Plenty of Growth coming from the East.

read more


Commodity Markets at a Glance WSJ
Commodities

Gold settled at a four-month high Friday, clocking in a 2.3% gain in a
week marked by rising concerns about a spreading sovereign debt crisis
in Europe and as investors sought out gold and other metals as a hedge
against currency weakness.Gold for June delivery, the most active
contract, added $11.90, or 1%, to settle at $1,180.70 an ounce on
Comex - a stone's throw from an early December high around $1,220 an
ounce for a most-active contract.As a reflection of investors
eagerness to load up on gold and other metals, physical holdings in
exchange-traded funds backed by gold hit records this week, analysts
at Barclays Capital said. Gold prices gained 6% in April.

"The big thing today is that gold held above the $1,160 level," which
it had tried to pierce in recent days and failed, said Matt Zeman, a
trader at LaSalle Futures Group in Chicago. "We did see it break
through. It looks very bullish to me and looks like it's going to keep
working its way higher. We may see going to $1,200 in the next couple
of sessions."

read more





Brazil Trades A-Rated as Growth Makes Debt Safer Bloomberg
Emerging Markets

The cost to protect Brazil bonds, ranked BBB- by Standard & Poor’s,
from default for five years fell seven basis points this month to 123
basis points, or 1.23 percentage points, according to data compiled by
CMA DataVision. In Europe, where Greece’s spreading debt crisis led to
downgrades this week, swaps on Portugal almost doubled this month to
2.9 points, even though its debt is rated A-, three levels higher than
Brazil.

“If you look at the European economies, they’re clearly credits in
decline and this is a credit on the rise,” Sebastian Briozzo, an S&P
analyst, said in a phone interview from Boston.

Brazil’s credit-default swaps are less expensive than Bahrain, which
is rated A, or four levels higher, as well as South Africa, two steps
higher, and Russia, one level. Brazilian swaps point to a ratings
increase of as many as two levels, according to Donato Guarino, an
analyst with Barclays Plc in New York.

At 1.23 points, it costs $123,000 to protect $10 million of Brazilian
debt against default for five years. That compares with a cost of
$432,000 on March 2, 2009, when the global credit crisis eroded demand
for emerging-market assets.

The extra yield investors demand to own Brazilian dollar bonds instead
of U.S. Treasuries narrowed two basis points to 1.88 percentage points
at 3:51 p.m. in New York, according to JPMorgan Chase & Co. That gap
is down from 3.55 percentage points a year ago. The average spread for
emerging-market dollar debt shrank two basis points to 2.58 points. A
basis point is 0.01 percentage point.

The nation’s foreign reserves have climbed 26 percent to a record $247
billion over the past two years as the central bank bought dollars to
slow the real’s rally.

Conclusions

There appears to be a great deal of left Over and Historical Pricing
in the Sovereign Credit Markets and thiis is an example.

read more



The People's Bank of China announced Sunday it was increasing commercial banks' reserve requirement ratio by 0.5 percentage point
China

The Chinese central bank's move over the weekend to raise banks'
reserve requirements was designed to remove excess liquidity, as hot
money pours into the country, due in part to hopes of the yuan's
appreciation.

But while Chinese banking and property shares declined Monday as the
monetary-policy tightening weighed on investor sentiment, the increase
may actually be mildly positive for Chinese banks, some analysts said.

The People's Bank of China announced Sunday it was increasing
commercial banks' reserve requirement ratio by 0.5 percentage point,
taking the RRR of large banks to 17% and that of small- and
medium-sized banks to 15%.

The increase, which goes into effect May 10, is the PBOC's third such
hike this year and is estimated to drain out about 300 billion yuan
($43.9 billion) in liquidity from the Chinese banking system.

read more



Africa Boom Lures Investors as Growth Set to Double Bloomberg
Africa

Sub-Saharan Africa’s economy will probably expand 4.7 percent this
year, double the pace of 2009, according to the International Monetary
Fund. Commodity exporters, including Angola, which vies with Nigeria
as the continent’s largest oil producer, and Botswana, the world’s
biggest diamond supplier, will lead the growth.

Capital flows into Africa rose 16 percent in 2008 to a record $62
billion even as foreign direct investment that year fell 20 percent
worldwide, according to the World Economic Forum

China needs Africa as much as Africa needs China.

Agricultural loans are another area of growth on the continent, where
farming employs 65 percent of the labor force and accounts for 32
percent of gross domestic product, according to the World Bank.
Agriculture is being spurred by foreign investment, such as Indian
food processing company Karuturi Global Ltd.’s leasing of 300,000
hectares in Ethiopia to produce food for export.

Conclusions

I am on the BBC World Service tomorrow discussing this Very Point.

I believe it is Africa is the last Convergence Trade in the c21st.

read more


South Africa All Share Index Bloomberg Visual
World Of Finance

Value28,635.76   
Change-80.510    
% Change-0.280

Conclusions

I still look for 30,000 here.

read more


Nigeria All Share rallies 2.573% on Friday Bloomberg Visual +27.01% 2010
Africa

Value26,453.20   
Change663.670    
% Change2.573

Conclusions

That Correction was just shy of 10% and we have bounced 3% off that
low which is a perfect Pull Back in a Bull chart formation.

read more


TUNIS SE Index Bloomberg Visual +13.423% 2010
Emerging Markets

Value4,867.66   
Change32.130    
% Change0.664

Conclusions

The Lowest Beta and probably my 1st Choice in SSA because of that Fact.

read more


Ghana All share Bloomberg Visual +16.529% 2010
Africa

Value6,518.88   
Change25.590    
% Change0.394

Conclusions

Plenty of Head Room here ahead of +20% GDP Growth Rates.

read more


Ecobank Transnational First-Quarter Profit Rose 5.1% Bloomberg
Africa

Ecobank Transnational Inc., the Lome, Togo-based company which
operates banks in 27 African countries, said first-quarter profit rose
5.1 percent as it earned more from loans and fees. Net income in 2009
fell 42 percent to $64.6 million, Ecobank said in a separate statement
published in the Times today. It proposed a dividend of 0.3 cents per
share, from 0.2 cents per share in 2008.

Ecobank Transnational Inc share price data Bloomberg
http://bit.ly/94hTU7

Price19.050
52-Wk High (04/13/10)20.500   
52-Wk Low (05/07/09)8.040   
1-Yr Return114.323
Earnings0.014   
Price/Earnings9.055

Conclusions

It had gotten very cheap last Year.

read more


Somali fighters seize coastal town AlJazeera
Africa

Heavily armed fighters from Somalia's Hizbul Islam group have seized a
town used by pirates in the country's north, residents said. The
fighters faced no resistance as they moved into the town of Haradheere
early on Sunday, pledging to take over more towns in the region.

Sheikh Mohamed Osman Arus, a spokesman for the group, told the Reuters
news agency: "Our Mujahidin fighters are in Haradheere now, they will
cross into the other towns in the region."

Pirates in Haradheere, however, said Hizbul Islam, which has vowed to
topple the UN-backed government, sent agents to the coastal town to
demand a portion of their business a few days ago, but the pirates
refused.

"They came into the town, they want to have their own pirates in here
and oust us," Hassan, a pirate who was fleeing the town, told Reuters.

"Some of their agents came to us two days ago and asked us to work
with them and pay. We rejected this and they entered today," he said.

read more


South Africa Beyond the Soccer Stadium WSJ
Africa

The more than 300,000 visitors expected here next month for the World
Cup will be looking for some place to celebrate victory, ease the
sting of defeat, or just calm down after the frenzy. One answer lies a
short drive from Cape Town: a coastline populated by whales, seals and
penguins and, farther on, three-century-old farms that offer up
memorable characters and some of the country's finest vineyards.

read more


ACK rejects 'No' campaign rallies The Nation
Law & Politics

ACK Archbishop Eliud Wabukala on Sunday said the launch of the ‘No’
campaign at Uhuru Park next weekend was likely to open doors for an
emotional rather than a “sober” approach to the referendum debate.

He spoke as Cabinet ministers and MPs in the Yes and No camps
campaigned vigorously in various regions at the weekend.

Conclusions

It is a curious Debate. Full of Smokes and Mirrors.

read more




Scangroup buys major stake in Ogilvy East African
N.S.E Equities - Commercial & Services

In a move that is likely to reshape the advertising and media business
in Africa, Scangroup is set to buy Ogilvy East Africa.

This will see Scangroup buy out huge chunks of Ogilvy & Mather’s
continental business, of which Kenya is the biggest market. Scangroup
is an associate company of the global communication agency network WPP
and one of sub-Sahara Africa’s largest communications groups.According
to insiders, this deal is valued at $6.1 million (Ksh460 million) and
it will be partly in cash ($1 million) and the rest in Scangroup
shares listed on the Nairobi Stock Exchange.It will dilute existing
shareholders by 5.95 per cent and increase WPP’s holding in Scangroup
to 27.5 per cent.With WPP’s 27.5 per cent stake just a whisker behind
Mr Thakrar’s 28.53 per cent holding.

read more


Scangroup share price data www.rich.co.ke
N.S.E Equities - Commercial & Services

Par Value:                  1/-
Closing Price:          27.50
Total Shares Issued:          220,689,648
Market Capitalization:        6,069M
EPS:            1.81
PE:                15.193

read more


Biggest Ever African Tea Auction Held in Mombasa Last Week Bloomberg
Commodities

The Mombasa Auctions held their biggest ever tea sale this week,
offering 10.54 million kilograms (23.2 million pounds) of the leaves,
Africa Tea Brokers Ltd. said in an e-mailed statement today.

Tea prices rose 1.6 percent to average of $2.61 a kilogram at the sale
in the Kenyan coastal town of Mombasa, where tea from a number of
African countries sell their output.

Yesterday the Kenya Tea Board said that production in the first
quarter of the year was the highest in five years. Kenya is the
world’s biggest black tea exporter.

Conclusions

Prices rose on that Supply and that tells you how Firm Prices are.

read more


Kenya's inflation rate slows to 3.7 pct April Reuters
Kenyan Economy

Kenya's year-on-year inflation rate slowed to 3.7 percent in April
from 4.0 percent a month earlier, thanks again to slower food price
rises, official data showed on Monday.

The inflation rate in east Africa's biggest economy is the lowest
since October 2005 when it was also 3.7 percent, although the two
measures were calculated using different methodologies and are not
directly comparable.

The headline rate is also well below the central bank's 5 percent
medium-term target, increasing the likelihood there could be further
interest rate cuts in the coming months.

Conclusions

Optimal.

read more



 
 
N.S.E Today

The NSE20 closed down 16.06 points at 4217.18.
The NASI was down 0.41 points to close at 89.72.
Market Cap was 1.044726 Trillion versus 1.049504 Trillion.
Equity Turnover was subdued at under 200m.

This Pull back has been orderly and shallow and I expect a move higher
towards 4482 resistance on the NSE20 with a strengthening Bellweather
Safaricom as it begins to breach 6.10 its 12 month high.



N.S.E Equities - Agricultural

Tea Production has hit a 5 Year High as per the Tea Board and prices
remain at a multi Year High Structure. Full Year Reports due will
confirm that these are excellent times to be a Tea Farmer. Sasini
trades on a Forward Implied PE of less than 5, Williamson Tea trades
on a Forward of about 4 and Kakuzi on a Trailing PE of less than 5.00.
I expect a dynamic Price adjustment around the Full Year Results oiled
by some supernormal Dividend Pay Outs.

Sasini Tea firmed 3.11% to close at 14.90 and traded a 14.50-15.50
range and 276,900 shares.
Rea Vipingo closed at 19.60 on 5,000 shares.
Kakuzi traded +4% at 78.00.



N.S.E Equities - Commercial & Services

Safaricom

shares volume     6.674m
avg price     5.84 Closing Price 5.80 Unchanged
high price     5.90
low price     5.80
last price     5.85

Conclusions

We have been at this level since 20th April and the price is well
supported here with a Bias to test 6.10 12 month Highs ahead of Full
Year results. Safaricom was the most active Counter at the Bourse.

ScanGroup announced Friday a share swap with Ogilvy and this followed
through into the Market today. ScanGroup rallied 5.5028% to close at
28.75 and traded a 27.00-30.25 range and 143,000 shares worth 4.142m.
30.25 is a 52 week high.

Nation was marked down 2.78% to close at 140.00 and traded a
139.00-144.00 range and 57,700 shares worth 8.108m.
Standard traded 1,900 shares at 41.00 -1.2%.

Kenya Airways firmed 0.88% to close at 57.00 and traded a 56.50-58.00
range and 106,200 shares worth 6.065m. There was an Overhang of Supply
which is nearing Exhaustion now.

Access Kenya closed 7.1% lower at 18.30 and traded a 17.75-19.80 range
and 210,700 shares worth 3.863m.

CMC Holdings closed lower at 13.15 and traded 37,100 shares.
CARGEN traded 100 shares at 38.00 +2.01%.

TPS Serena shaved off 50 cents to close at 63.50 and traded 4,400 shares.



N.S.E Equities - Finance & Investment

KCB was the 2nd most active Counter and edged 1.09% easier to close at
22.75. KCB traded a 22.75-23.25 range and 1.510m shares worth 34.726m.
KCB has announced a Material Rights Issue [and 1st Quarter 2010
results +10% ahead] but are yet to detail the Degree of Discount.
24.00 has proven long term resistance through this Year and Last.
Equity Bank traded 4th at the Bourse. Equity Bank shaved off 0.25% to
close at 18.50 and traded an 18.30-18.65 range and 664,500 shares
worth 12.295m. The 1st Quarter 2010 Earnings Report confirmed an
Inflexion and a return to much steeper Growth Trajectory which will
point the price towards 20.00.

HFCK [which is apparently Prey to Equity Bank's Predator] reported 1st
Quarter 2010 earnings +52.55% after the Bell. HFCK'S price was trimmed
3.195% today to close at 22.75. HFCK traded a 22.25-23.50 range and
107,400 shares worth 2.443m.

COOP Bank eased 0.42% to close at 11.80 and traded a 11.70-12.00 range
and 713,300 shares worth 8.45m.
Barclays Bank rallied 0.87% to close at 58.00 and traded a 59.00 high
and 100,400 shares.
StanChart closed down 3 shillings at 196.00 on 2,900 shares.

Centum firmed 0.28% to close at 17.90 and traded a 17.70-18.10 range
and  162,300 shares.

Kenya Re closed a further 5 cents lighter at 13.20 and traded a
12.80-13.35 range and 430,800 shares. Kenya Re reported Full Year 2009
behind 2008 last week, higher Claims Pay Out Ratios on its Books and
this has led it to lose some ground since the Results were announced.
Jubilee closed down 2 shillings at 178.00 and traded 1,300 shares.
PanAfric did not trade.

The MidCaps ex HFCK were very lightly traded.
CFC StanBic eased 0.5% to close at 49.75 and traded 15,500 shares.
DTB eased 0.58% to close at 85.00 and traded 6,700 shares.
NBK dipped 1.14% to close at 43.25 and traded 6,600 shares only.
NIC retreated 75 cents to close at 38.00 and traded 14,000 shares.

Olympia Capital is at 9.40.



N.S.E Equities - Industrial & Allied

Mumias Sugar traded 3rd overall. Mumias Sugar eased 0.38% to close at
13.00 and traded a 12.95-13.30 range with 1.969m shares worth 25.689m.
Mumias announced Friday that Sugar Cane Crushed would be +15% at the
Year End. This will lend support to the price to 13.60 [10 Implied
Forward PE] and probably towards 16.30 which equates to a forward of
12.00.

Unga closed 7.72% firmer at 11.85 and traded 24,900 shares.

Bamburi closed at 185.00 [Its recent clearing Price] -2.12% and traded
59,400 shares worth 10.997m.
ARM was unchanged at 115.00 and traded 4,300 shares.
Portland was unchanged at 120.00.

KENOLKOBIL firmed 0.6% to close at 84.50 and traded 51,400 shares
worth 4.345m. Demand outweighs Supply pointing the Price towards
90.00.
Total firmed 0.83% to close at 30.25 and traded 41,600 shares. Retail
Fuel Prices are being increased this week.

KENGEN eased 0.32% to close at 15.75 and traded 114,200 shares.
KPLC was unchanged at 180.00 and traded 14,800 shares.
Cables closed lower at 21.50 and traded 40,000 shares.

Crown Berger retreated 2.63% to close at 37.00 and traded 12,300
shares. Crown Berger reported Full Year EPS more than 200% ahead of
the Previous Year last week. Crown Berger has returned 140.92% over 12
months.

EABL closed a shilling lighter at 169.00 and traded 22,800 shares.

BOC Kenya closed +1.46% at 139.00 and traded 1,500 shares.
Carbacid traded 4,500 shares at 145.00 unchanged.

Eveready slipped 3.09% to close at 4.70 and traded 19,200 shares.
Sameer eased 5 cents to close at 9.60 and traded 83,600 shares.



by Aly Khan Satchu (www.rich.co.ke)
 
 
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May 2010
 
 
 
 
 
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