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Satchu's Rich Wrap-Up
 
 
Tuesday 02nd of November 2010
 
Morning
Africa

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

What is #Mindspeak ?
http://bit.ly/9mhe39

A Selection of Tweets from the Real Time Stream. Search #Mindspeak on
www.twitter.com. Its quite a Phenomenon. I am looking for Long Term
Partners. The Brand Equity and Association is very c21st and Valuable
I venture.

@njooro RT @alykhansatchu: If you want to succeed it's a 25 hour Job
Martin O-O KCB www.rich.co.ke
@ojcecil @alykhansatchu Mindspeak filled to the rafters today.Effect
of Martin OO or how it went viral on twitter?
Good evening @Alykhansatchu from Cal...Following #Mindspeak
hashtag...Most informative.

The Star Tatu City Eaagads Agricultural Companies Renaissance
http://bit.ly/9efD51

Macro Thoughts

The Big Event is the FOMC and the Quantum of QE2.

Home Thoughts

The Little One received her First Reading Book from her School and has
been relentless in having Everyone read it to her. I have this
enormous Library of Books and I have a sneaking suspicion She will
inherit it.

read more


Looking for Investments, China Turns to Europe NYT
China

When Prime Minister Wen Jiabao of China visited Athens last month, he
came bearing gifts: billions of dollars worth of business deals and a
wave of favorable attention from a crucial foreign investor. “The
support of our Chinese friends is fortunate for us,” Greece’s minister
of state, Haris Pamboukis, said by telephone.

But China had much greater ambitions. Greece is one foothold for
China’s broad, strategic push into Europe. It is snapping up assets
depressed by the global financial crisis and becoming a significant
partner of other hard-hit European nations.

Ultimately, analysts say, Beijing hopes to achieve not just more
business for its own companies, but also greater influence over the
economic policies set in the power corridors of Brussels and Germany.

“They are indicating a willingness to stick their nose into Europe’s
business,” said Carl B. Weinberg, chief United States economist of
High Frequency Economics.

“It’s very clever and sends a clear message,” he added, “that China is
a force to be contended with.”

That message will be reinforced by a visit this week by China’s
president, Hu Jintao, who is scheduled to meet with top officials and
business executives of Portugal and France.

Europe’s financial crisis this year has created buying opportunities
for cash-rich investors, including secretive hedge funds and Qatar,
the natural gas giant of the Persian Gulf that recently agreed to
invest $5 billion in Greece. But China is leading the charge. It is
singling out Greek, Spanish and other downgraded government debt, as
well as ports, highways and industries in troubled countries on
Europe’s eastern and southern edges.

“What is happening is that the Chinese are expanding in Europe as they
did in Africa,” said François Godement, a senior policy fellow of the
European Council on Foreign Relations. “But in Europe, they’re coming
in through countries on the periphery, which is extraordinary.”

“What Europe lacks is a transportation infrastructure network where
Western and Eastern Europe meet,” he said. “This is where China is
trying to take advantage of their current buildup.”

Still, for all the fears of ulterior motives on China’s part, many
Europeans welcome the investment with open arms. China is mainly
interested in promoting trade and making money, said Mr. Pamboukis,
the Greek minister of state.

China’s investment strategy in Europe is “discreet and well
thought-out,” he said. “I don’t think China is coming in here as a
Trojan Horse.”

Conclusions

The Overarching Question is this Who has the Dollars?

The Answer HU does.

read more



Fed Will Probably Start $500 Billion of Bond Buys, Survey Shows Bloomberg
World Of Finance

The Federal Reserve is likely to start a fresh round of unorthodox
stimulus tomorrow by announcing a plan to purchase at least $500
billion of long-term securities, according to economists surveyed by
Bloomberg News.

Policy makers meeting today and tomorrow will restart a program of
securities purchases to spur growth, reduce unemployment and increase
inflation, said 53 of 56 economists surveyed last week. Twenty-nine
estimated the Fed will pledge to buy $500 billion or more, while
another seven predicted $50 billion to $100 billion in monthly
purchases without a specified total. The remainder said the Fed would
buy up to $500 billion or didn’t quantify their forecast.

Disagreements among policy makers over whether to incrementally expand
the balance sheet or stage a so-called shock-and-awe program of big
asset purchases has created confusion among investors over the likely
size and duration of any new easing, said Ward McCarthy, chief
financial economist at Jefferies & Co. in New York.

“There has not been a uniformity of opinion emanating from the
multitude of public appearances from Fed officials,” McCarthy said. He
predicts the Fed will buy $500 billion of securities over the next six
months and was among 13 economists who said the purchases would
include mortgage-backed bonds in addition to Treasuries.

Federal Reserve Chairman Ben S. Bernanke. Photographer: Joshua
Roberts/Bloomberg

Conclusions

I think the Maximum Tolerance Level is $500b otherwise things could
get very disorderly.

read more


Currency Markets at a Glance WSJ
World Currencies

Euro 1.3925
Pound 1.6051
Yen 80.54
Aussie 0.9970 - Australia Raises Interest Rate to 4.75%, Ending Pause
Rand 6.969
Brazil Real 1.7033

Yesterday In Asian trading hours, the dollar had been much higher
against the yen, reportedly rising as high as ¥81.55 on the EBS
trading platform — a high so brief it wasn’t captured by all data
feeds — from about ¥80.40 at the stock market open.Rumors of currency
intervention percolated, but when no confirmation was forthcoming, the
trend began to reverse.

Institute for Supply Management’s index of U.S. manufacturing activity
rose to 56.9 in October, higher than some analysts had anticipated
helped the Dollar.

read more


Australia Raises Interest Rate to 4.75%, Ending Pause Bloomberg
World Currencies

The Reserve Bank of Australia unexpectedly increased its benchmark
interest rate on concern stronger growth will cause inflation to
accelerate, driving the nation’s currency toward parity with the U.S.
dollar.

Governor Glenn Stevens raised the overnight cash rate target a quarter
point to 4.75 percent in Sydney, saying the economy has “relatively
modest amounts of spare capacity” and citing risk of “inflation rising
again over the medium term.” It was the RBA’s first move in six
months.

The Australian dollar climbed to 99.71 U.S. cents as of 3:31 p.m. in
Sydney from 98.82 cents before the announcement. The S&P/ASX 200 Index
of stocks was little changed at 4,702.70.

Australia’s jobless rate, at 5.1 percent in September, is about half
the level of unemployment in the U.S. and euro zone. The International
Monetary Fund predicts Australia’s growth will advance to 3.5 percent
next year from 3 percent this year as resources investment
intensifies.

Conclusions

A Strong Economy that is tied quite closely to China's Coat Tails and
thats not a Bad Slipstream.

Aussie Dollar versus US Dollar INO 0.99748 Last
http://bit.ly/cwTAEa

Its headed over Parity.

read more


World Equity Markets at a glance
World Of Finance

Dow Industrials , up 6.13 points, or 0.06% to 11124.62.
Up two straight days and four of the last six

read more



Soft Commodities at a Glance INO
Commodities

Cocoa -1.08%
Coffee -2.83%
Cotton +1.65% New 140 Year High
Sugar +1.32 closing down on 30 cents

Cotton Dec 2010 131.41 +2.15 (+1.66%)
http://bit.ly/aUBV3p

Last Price    131.41
Open Int.    109238
Contract High    130.5 Contract High Date    2010-10-26
Contract Low    53.87
First Delivery    2010-12-21
Expiration    2010-12-07

Conclusions

Headed Higher still.

Sugar March 2011 29.45 +0.39 (+1.32%)
http://bit.ly/arDA0l

Last Price    29.45
Open Int.    272555
Contract High    29.8 Contract High Date    2010-10-29
Contract Low    11.9
First Delivery    2011-05-15
Expiration    2011-02-28

Conclusions

Headed through 30.00

read more




Steve Wynn $40 Million Lichtenstein Bloomberg
Misc.

Steve Wynn’s Roy Lichtenstein painting titled “Ohhh ... Alright...’’
(1964) could sell for $40 million at Christie’s International on Nov.
10.

At that price, the artist’s Pop depiction of a fetching redhead
sighing sadly on the phone would easily top his current $16.3 million
auction record. It would also confirm a growing belief among sellers,
dealers and auctioneers that the art market has sailed out of the
doldrums.

“Warhol is the volume trade,’’ said Cappellazzo. “The more it sells,
the more people want it. It trades like currency.’’

"OhhhAlright" a 1964 painting by Roy Lichtenstein sits on display
during a fall auction preview at Christies's in New York.
Photographer: Tom Starkweather/Bloomberg

"Coca-Cola Large Coca-Cola", a 1961-62 painting by Andy Warhol, sits
on display during a fall auction preview at Sotheby's in New York. The
work may fetch up to $25 million during the Sotheby's Impressionist
and Modern Art evening sale next month. Photographer: Tom
Starkweather/Bloomberg

read more


India Central Bank Raises Rates Sixth Time This Year Bloomberg
Emerging Markets

India’s central bank raised interest rates for a sixth time this year
in Asia’s fastest round of increases to cool inflation and said
further monetary policy tightening in the “immediate future is
relatively low.”

The Reserve Bank of India boosted the repurchase rate by a
quarter-point to 6.25 percent and the reverse repurchase rate by a
similar margin to 5.25 percent with immediate effect, according to a
statement in Mumbai. Fifteen of 23 economists had predicted the
decision in a Bloomberg News survey.

Governor Duvvuri Subbarao’s move comes as counterparts in nations from
Japan to the U.S. are considering additional monetary stimulus,
increasing the risk of an influx of capital into India that might
exacerbate inflation. The yield advantage of Indian 10-year government
bonds over similar maturities of U.S. Treasuries is hovering near a
decade high.

“Today’s rate increase is aimed at making sure that inflation doesn’t
get out of hand,” said Jay Shankar, chief economist at Religare
Capital Markets Ltd. in Mumbai. At the same time, “it’ll further add
to higher inflows” of capital from overseas, he said.

The rupee gained 0.2 percent to 44.39 per dollar as of 11:48 a.m. in
Mumbai, while the benchmark Sensex index of stocks was little changed
at 20,344.

Economists’ Forecasts

Eight analysts had forecast no change in the repurchase rate in the
Bloomberg survey before today’s decision. One expected a half-point
increase in the reverse repurchase rate while the remaining seven said
it may be kept on hold.

The central bank’s rate increase is aimed at slowing the fastest
inflation after Argentina in the Group of 20 nations and at protecting
the purchasing power of 75 percent of Indians who live on less than $2
a day. Consumer prices rose 11.1 percent in Argentina in September,
while CPI for industrial workers gained 9.9 percent in India.

“The current rate of inflation is still above the comfort zone of the
Reserve Bank,” Subbarao said in the statement and cited surging asset
prices for today’s move. He said India’s equity market is close to a
record and residential prices in cities have risen “beyond the
pre-crisis peak level.”

Accordingly, the governor ordered commercial banks to increase the
“risk weight” on home loans of 7.5 million rupees and above to 125
percent from between 75 percent and 100 percent, the central bank
statement showed. He also increased the provisioning requirement for
lenders against the so-called “teaser” housing loans to 2 percent.

The governor today reiterated the central bank’s inflation and growth
forecasts made in July. He expects the benchmark wholesale-price
inflation to slow to 5.5 percent by March 31 from 8.6 percent in
September as per the new series of the index released on Sept. 14, and
the Indian economy to expand 8.5 percent in the year ending March 31.

Since Subbarao’s first rate increase on March 19, the spread between
India’s debt due in a decade and 10-year Treasuries widened 131 basis
points, or 1.31 percentage points, to 551 yesterday. The gap, which
has averaged 317 in the past decade, reached a 10-year high of 567
basis points on Oct. 20.


Higher yields spurred an unprecedented $10 billion inflow into rupee
debt this year. Overseas funds also poured a record $25 billion into
Indian stocks on prospects of faster growth in the South Asian nation,
strengthening the rupee and driving the Bombay Stock Exchange’s
Sensitive Index to near a record.

Since Jan. 1, the rupee has risen 4.5 percent to 44.48 against the
dollar while the Bombay Stock Exchange’s Sensitive Index has jumped
16.5 percent.

read more


Tension mounts in Tanzania over delayed vote results Reuters
Law & Politics


Tanzanian police fired tear gas to disperse opposition supporters in
the commercial capital on Monday as tension rose over delays in
releasing the results of Sunday's presidential and parliamentary
elections.Tanzanian President Jakaya Kikwete took an early lead while
Ali Mohamed Shein won the presidential vote in Tanzania's
semi-autonomous archipelago of Zanzibar.

Voting on the palm-fringed islands off Tanzania were tainted by
bloodshed and allegations of ballot rigging in 2000 and 2005.

The protesters in Dar es Salaam were angry at the outcome of a council
election run alongside Sunday's national votes that are expected to
give President Jakaya Kikwete another five years at the helm of east
Africa's second largest economy.While opinion polls show his lead
narrowed as his main opponent, Willibrod Slaa, of the Chadema party
campaigned hard on an anti-corruption platform, analysts predict that
Kikwete's pledge to keep fighting poverty should hand him a final
term.

Members of the opposition said the delays were in areas where their
candidates were likely to win parliamentary seats.

"The situation is tense ... I have received reports that police have
used tear gas in Mwanza, Arusha and Dar es Salaam. People are restless
because they want the results to be made public," said Mwesiga Baregu,
Chadema campaign manager.

"The situation is bad. We have reached a point where we might see
bloodshed, just like what happened in Kenya when the election results
were delayed."

Conclusions

Probably the Apogee of the Tension right now.

read more



Citadel targets more buyouts in eastern Africa Business Daily
World Of Finance

Citadel Capital, the Egyptian private equity firm with a majority
shareholding in Rift Valley Railways (RVR), is scouting for more deals
in East African firms specialising in Information Technology, food
processing, farming and transport.The company has set aside Sh32
billion ($400 million) for investing in Kenya, Tanzania and Uganda,
where economic growth for the three countries ranges between five and
eight per cent.

Speaking on the sidelines of the Comesa infrastructure conference in
Nairobi last week, the Citadel Capital managing director, Karim Sadek,
said: “If the opportunity is identified, we are ready. We will put in
the money; it could be a million dollars.”

The firm, that holds $8.3 billion (Sh665 billion) in assets —
equivalent to a quarter of Kenya’s GDP — has hired Mr Hassan Massoud
to head its eastern African office as part of the strategy to pursue
growth in the region.The target includes the five East African
Community countries and Ethiopia.Mr Massoud is a former senior analyst
at the energy, mining and process industries advisory unit of
multinational management advisory firm, A.T. Kearney.

“We are not interested in niche markets as such. We want to go for the
mass market without actually looking at high margins. Low margins are
good enough because there is a big market. This is the case in a place
like Kenya where the 38 million people already mean a huge market,”
said Mr Sadek.

Conclusions

Karim and I had a Coffee at the Norfolk a few months ago and he was
very interesting.

I conducted this Interview across the Internet with Ahmed Heikal
Chairman Citadel
http://www.rich.co.ke/media/docs/Citadel.pdf

read more


Leather Factory to Become Latest Chinese Investment in Ethiopia Bloomberg
World Of Finance


China’s Xinxiang Kuroda Mingliang Leather Co. will open a $67 million
leather factory in Ethiopia on Nov. 24, adding to the billions of
dollars already invested in the East African country by China.Xinxiang
financed 55 percent of the project, with the remainder coming from the
China-Africa Development Fund, the Chinese embassy in Ethiopia said in
an e-mailed statement today.

Chinese investments in resource-poor Ethiopia demonstrate that it is
interested in more than extracting raw materials from Africa, Chinese
Ambassador Gu Xiaojie said in an interview on Oct. 28. China’s ZTE
Corp. lent $1.5 billion in 2008 for Ethiopian Telecommunication Corp.
to upgrade its infrastructure, while other companies have helped build
hydroelectric plants, the ring-road around Addis Ababa and the
part-completed African Union Conference Center.

“Ethiopia is the best example to refute some of the criticism of China
being in Africa only for resources,” Gu said. “It has got nothing, but
we are coming to their needs.”

read more


Kenyan Inflation Slows, Raising Prospect of Interest Rate Cut Bloomberg
Kenyan Economy


Kenya’s inflation slowed to 3.1 percent in October, increasing the
likelihood of further interest rate cuts.The inflation rate in East
Africa’s biggest economy fell from 3.2 percent a month earlier, the
Kenya National Bureau of Statistics said in an e-mailed statement from
the capital, Nairobi, today. The government’s target rate is 5
percent. Prices rose 0.1 percent in the month.

“Inflation looks set to plumb new lows,” and the central bank “can
probably cut further,” Aly-Khan Satchu, a Nairobi- based independent
financial analyst, said by e-mail before the announcement. The falling
cost of calls on Kenya’s mobile networks is a key reason for the drop,
he said.

Kenya’s Monetary Policy Committee has slashed the benchmark lending
rate by 2.5 percentage points since 2009 to a record low of 6 percent.
Low inflation could help justify further cuts, adding to pressure on
commercial banks to reduce the cost of credit, Central Bank of Kenya
Governor Njuguna Ndung’u said on Oct. 25.Kenyan banks’ average lending
rate was 14 percent in September, according to central bank data. The
lenders have more scope to reduce borrowing costs to businesses and
households, Ndung’u said on Oct. 28.Kenya’s economy is projected to
grow 6 percent next year from an estimated 5 percent this year as a
new constitution approved in August bolsters investor confidence,
President Mwai Kibaki said on Oct. 21.Agricultural production, which
accounts for a quarter of the economy, is increasing after rainfalls
early this year ended a drought.

read more


A Tough Call for Safaricom CEO AllAfrica.com
N.S.E Equities - Commercial & Services


Many would later learn of the news from FM stations and social media,
notably Facebook and Twitter. Mr Bob Collymore, who took over as chief
executive of Kenya's Sh250 billion mobile phone company on Monday,
came to the job in the old-fashioned way: he was handpicked.The
industry is still agog about Vodafone's selection of Mr Collymore, a
little known 52-year-old manager who loves flying helicopters, to lead
the region's most profitable company.Undaunted, the low-key father of
two has taken over with confidence.

"At the end of every season, people will say there will be nothing
new," Mr Collymore said in an interview in his new office. "It's not a
matter of I coming in at the right time or wrong time. When video
came, many thought innovation had ended."

Clearly, he will work harder to convince sceptic market watchers,
customers as well as investment analysts that he will take Safaricom
to the next level. With its huge success, a lot of Kenyans are finding
it hard to resist the temptation to second-guess Mr Collymore, a
soft-spoken man who talks with an accented baritone as if it's not his
responsibility to speak audibly, but your work to listen.Michael
Joseph may have grown the company from just 16,000 subscribers to 16.3
million currently, but Mr Collymore sees "very huge potential" in both
innovation and invention. He has been around for two months
understudying Mr Joseph and says he has identified two critical areas
that need urgent fixing: network and customer care services.

I have been using the network and it has issues," he says. "We have a
fantastic customer care service, but volumes have grown and strained
capacity."

Mr Collymore says this happens because of high telephone traffic per
square kilometre in Nairobi, which equals the world's biggest cities
such as New York and London that have strong infrastructures.

So as he settles down to work, he is clear about his intentions, among
them, extending the 3G (third-generation) network across the country.
"We're going to reprioritise our investments to expand 3G coverage" he
said.Aside from making voice calls clearer and stable, the strong
network will power the next phase of innovation at Safaricom which, he
says, will aim at taking health and education cellphone services to
the masses, just like M-Pesa brought financial services to the palms
of poor farmers and urban househelps.

"The impact on health will be huge," he said. "An ordinary child in
Eldoret doesn't have access to education and medical services. Compare
that to a child in Manhattan, who is just two clicks away."

"Bob is a seasoned and effective executive with substantial
experience, leading and integrating businesses with a real
understanding for Africa," said Safaricom board chairman, Nicholas
Ng'ang'a, when he announced the appointment late July. "He is the
ideal leader for Safaricom at this time."

"Voice revenues have stagnated, and competitors with deep pockets,
Bharti Airtel and MTN have entered the market with the firm intention
of eating Safaricom's lunch -- or at least getting some of the
crumbs."

As Safaricom's bottom line takes hits from the price wars, he says, Mr
Collymore faces an instant pressure to cut costs rapidly and
significantly. "I expect his first year or so to be pre-occupied with
finding ways to reduce Safaricom's operating and maintenance
expenditure (opex), as well as finding more efficient ways of using
capital expenditure (capex)."

"I need three or so months of working here to know what to do," he
says. "In the meantime, I will continue with the current strategy. But
that won't be about low pricing. Current calling rates at 4 US cents
per minute is best in class and even lower than West Africa at 15
cents.

"People are so fixated with competition, but we are going to look at
quality. Lower rates would mean network issues like in India. I don't
think Kenyans are prepared to accept such low standards." Rock bottom
prices in India have resulted in poor service such as network
congestion and dropping of calls.

He said the price war will certainly squeeze its revenues, but added
that it would be made up for by growing incomes from its data
businesses in internet services and M-Pesa, the money transfer
service. "We are doing fixed and mobile data. Some of our competitors
are 99 per cent voice. It's clear who's going to be in trouble."

"Bob's style will be different but he has been looking at this
business up, close and personal, for quite a long time and; hence, is
not a shoehorn dropped into Kenya from another planet," says Aly Khan
Satchu, investment analyst and NSE data vendor. "The future is data
and in this regard Safaricom continues to show everyone a clean pair
of heels."

Conclusions

Dec 4th Bob Collymore is the Guest Speaker.

Safaricom share price data www.rich.co.ke
http://bit.ly/4cdZRM

Par Value:                  0.05/-
Closing Price:          4.90
Total Shares Issued:          22,915,800
Market Capitalization:        1M
EPS:            0.38
PE:                12.895

read more


Barclays finalises sale of custody unit to StanChart The Standard
N.S.E Equities - Finance & Investment

Barclays Bank of Kenya has finally concluded the transfer of its
custody services business to Standard Chartered Bank Kenya effective
from October 31.

"We would like to take this opportunity to thank our clients, our
employees as well as the regulators — Central Bank of Kenya,
Retirement Benefits Authority and Capital Markets Authority — for
their support in the execution of this transaction," said Adan
Mohamed, the bank’s Regional Managing Director in-charge of East and
West Africa.

The proceeds of the transaction, valued at Sh3.5 billion, will be
re-invested in the bank’s business and help improve shareholder
earnings. The funds will also be used to upgrade the bank’s core
banking platform.

"This transaction provides the bank with the opportunity to release
tremendous value, which positions us well to increase Barclays
presence in our core activities across the region," Mohamed said in a
statement yesterday.

read more


Kenya’s East Africa Breweries Names New MD, Daily Business Says
N.S.E Equities - Industrial & Allied

Diageo Plc’s Kenyan unit, East African Breweries Ltd., appointed
Richard Wells, formerly commercial director of Brandhouse, as Managing
Director, Business Daily reported, citing an official from the
company.Wells will replace Ajay Mehta, who will remain an executive
director for special projects, the Nairobi-based newspaper today cited
Brenda Mbathi, EABL’s group corporate relations director, as saying.
Allan Hood, who was Diageo’s finance director for Jamaica, becomes
East African Breweries’ finance director, Business Daily said.

East African Breweries Ltd. said on Oct. 26 it had completed the
acquisition of 51 percent of Serengeti Breweries Ltd. of Tanzania at a
cost $60.4 million.

EABL share price data from www.rich.co.ke
http://bit.ly/57wrgL

Par Value:                  2/-
Closing Price:          211.00
Total Shares Issued:          790,774,336
Market Capitalization:        166,853M
EPS:            9.09
PE:                23.212

read more


Foreign firms intensify the chase for Kenya’s gold Business Daily
Africa

It all began five years ago with the announcement that a UK firm
Goldplat Plc had discovered large deposits of gold in western Kenya
spanning the expansive Migori and Transmara counties with some
estimates indicating that the deposits could rival South Africa’s when
fully exploited.More than 10 international mining firms have
intensified their activities in western Kenya, which mining experts
say might experience a real gold rush in the next 10 years.

The firms include Aviva Corporation of Australia, Afri Ore Ltd, East
Africa Pure Gold Ltd, Covenant Mining Ltd, Karebe Gold Mining Ltd,
Gold Rim Exploitation (K) Ltd and Abba Mining Company.

Interest in Kenya’s gold mining sub-sector went a notch higher mid
last month with the arrival in Nairobi of South African investment
bank Absa Capital for talks with Kenya’s capital markets regulator on
the prospects of establishing gold-backed exchange traded funds (ETFs)
at the Nairobi Stock Exchange.

“We have started discussions with both the NSE and the CMA regarding a
secondary listing of the NewGold Exchange Traded Fund (ETF) on the
NSE,” said Absa Capital’s associate principal marketing and corporate
Communications officer, Graeme Coetzee in an interview. “The
discussions were quite positive but we must however point out that
they are still in very early stages.”

read more


Githongo: Colonial spoils recycled as new money Africa Report
Africa


Kenya was a project conceived by the British and inherited by an
African elite. It was simple: take boys from the village, send them to
Alliance High School and then Makerere University

The Kenyan middle class has turned state formation into a resource
grab. In an agrarian country, that means mainly land. Four groups call
themselves middle class. Firstly, the state elite, most of whom have
stolen public resources. Then there is an entrepreneurial petite
bourgeosie which started trading from a kiosk, then worked to put
their kids through university and prospered without state patronage.
There is also an agrarian middle class of landowners. Some benefit
from state patronage but many do not – such as the man who grows
French beans on his 20 acres of land, using the proceeds to pay for
his children’s education. Finally, we see the middle class as the
professional elite: lawyers, bankers, doctors, civil-society wallahs.
They speak English without mother-tongue interference and sound
Western.

The state elite has tentacles everywhere because of the scale of
government spending and its effect on politics. A generational divide
is developing in the middle class. The state elite stole billions of
shillings and thousands of acres. Most escaped prosecution.

Now, almost 20 years after Goldenberg and the other mega-scandals, the
crooks have recycled their reputations. Memories of the crimes are
fading. The sons and daughters of the state elite are back from school
at Princeton and Yale. They will join you over a beer at Kengeles in
Lavington. They are doctors and lawyers, a new generation of
middle-class professionals. Daddy’s money has been washed clean in the
laundry of our corrupt society. So we are building a middle class on
corruption and impunity, which breeds searing inequalities.

The state security system tries to shut down the dissidents and the
aggrieved. In an agricultural country like Kenya, it is about land,
especially the Rift Valley. The Rift Valley was Kenya’s demographic
shock absorber and now that is over. In Kikuyu, we say “andu mathi
ruguru” meaning “people have gone to the West,” or the Rift Valley.
The migration to ruguru ended in 2007. Even if we took all the land
from the grabbers and redistributed it, we would briefly have peace,
but then fundamental economic problems would spark new political
crises.

The middle classes normalise the absurd. We are carrying the memory of
the 2007 post-election violence: the maids and houseboys of the middle
class were chopped up. On one hand, the middle class celebrates and is
benefiting from the economic growth of President Mwai Kibaki’s first
administration, yet the software of the nation has seriously
malfunctioned.

We have to rethink what Kenya is. Three-quarters of Kenyans are under
30 and want to live in towns, but we are ruled by farmers and trapped
by land disputes. The challenge for the middle class is to lead the
country out of this crisis.

John Githongo is a former permanent secretary for governance and ethics in Kenya

Conclusions

This will be a Time of Maximum Disruption in fact.

The New Fortunes will be created in leveraging Human Capital. It will
be quite an About Turn.

Furthermore, I happen to believe that we have entered an Information
Century. Everyone is connected. And The Evidence Trail so evident in
this New Age -

The Evidence Trail is taking No Prisoners, You might note.

read more





 
 
N.S.E Today

The NSE20 rose 11.81 points to close at 4686.98 and less than 0.5% off
its 2010 High.
The NASI eased 0.17 points lower to close at 102.56.
Market Cap was 1.223374 Trillion versus 1.225547 Trillion last time.
Equity Turnover was 582.062m versus 511.702m and There has been a
noteable Move in Volume Terms.
The Action is Broad based and broadening out further. Kenya Airways
and Safaricom are slated to release their Half Year Results imminently
and the Bourse will take a steer from those Results.



N.S.E Equities - Agricultural

Eaagads rallied a further 4.38% to close at 59.50 and traded 32,600
shares. Eaagads is up 200% over 12 months and the Top Performer at the
Bourse over that Period. News that some of the Coffee Estates have
been flipped into Real estate for the Tatu City Development has had

Investors scrambling for their Slide Rules and looking a whole lot more closely at the NAV and Break Up Value.


Rea Vipingo rose 1.116% to close at 17.35 and traded 3,300 shares.
Sasini Tea closed 5 cents easier at 14.45 and traded 45,500 shares.



N.S.E Equities - Commercial & Services

SAFARICOM

shares volume     9,276,400
total turnover     45,277,140
closing PRICE 4.85 -1.02%    
high price     4.95
low price     4.80
last price     4.80

Conclusions

Safaricom edged 1.02% lower to close at 4.85 and traded 9.276m shares
worth 45.277m. Safaricom releases Half Year Results imminently and I
feel the market has built in a very steep concession into the Price,
ahead of those Results.

ScanGroup was unchanged at 69.50 and traded 154,200 shares. Scangroup
is the 2nd best performer at the NSE after Eaagads and has posted a
189.309% 1 Year Return.

Kenya Airways eased back 1.11% to close at 44.25 and traded 94,400
shares. Investors await the Results.

Nation traded 166,100 shares unchanged at 163.00 .
Standard dipped to close at 46.50 and traded 4,800 shares.

Access Kenya traded 419.500 shares and all unchanged at 17.35.

CMC Holdings snapped back 4.365% to close at 13.15 and traded 1.037m shares.
CarGen did not trade.

TPS Serena came off a shilling to close at 69.50 and traded 25,500 shares.



N.S.E Equities - Finance & Investment

Equity Bank was the most active share at the Nairobi Bourse today.
Equity Bank firmed 0.97% to close at 26.00 and traded a 25.75-26.25
range and 3.586m shares worth 93.259m. Equity Bank sits 3.7% below
27.00 its recent and 2 Year Closing High.

KCB firmed 1.11% to close at 22.75 and traded a 22.50-23.00 range and
1.012m shares worth 23.032m. KCB trades at Implied Forward PE of under
9.00 [if You extrapolate the 3rd Quarter Results on a straight Line
Basis] and hence the Price looks well supported here.

StanChart reported Pre Tax 3rd Quarter 2010 results 19% ahead of the
same time last Year. I have yet to properly analyse the Results but
the Run Rate looks as it has slipped a Notch or two versus the 1st
Half. StanChart is paying a 5 shilling Dividend. StanChart retreated
2.876% to close at 271.00 and traded 3,400 shares only. StanChart also
completed the Acquisition of the Barclays Custody Business.

Barclays Bank improved 0.75% to close at 67.50 and traded a
67.00-68.50 range and 218,600 shares worth 14.842m.

COOP Bank retreated 5 cents to close at 19.85 and traded a 19.80-19.95
range and 1.013m shares worth 20.158m.

CFC StanBic firmed 0.56% to close at 89.00 and traded an 87.50-89.00
range and 416,500 shares worth 37.066m. CFC Stanbic has posted a 78% 1
Year Return and Management is unlocking Value for Shareholders via a
Listing of the Insurance Business.
HFCK snapped back 6.545% to close at 28.50 and traded 47,600 shares
with Demand for 8 x that amount as Buyers tried to snaffle some cheap
shares.
NIC closed higher at 49.00 and was trading at 50.00 +2.56% at the
close. NIC traded 165,100 shares worth 8.147m.
DTB rose 1.5% to close at 135.00 and traded a 134.00-139.00 range and
25,100 shares worth 3.395m.
NBK eased 0.63% to close at 39.75 and traded 24,200 shares.

Centum rallied 4.26% to close at 24.50 and traded a 23.75-25.00 range
and 772,200 shares worth 19.103m. Centum is one of the Top Performers
at the Bourse and has rallied 155.45% over the last 12 months.

Kenya Re improved 5 cents to close at 11.90 and traded an 11.80-12.00
range and 385,100 shares.
Jubilee traded 2,700 shares and closed at 197.00.
PanAfric did not trade.



N.S.E Equities - Industrial & Allied

Athi River Mining was the 2nd most actively traded share. ARM eased a
shilling to close at 175.00 and traded a 165.00-176.00 range and
399,400 shares worth 70.273m. ARM has posted an 81.648% 1 Year Return
and sits 5.405% below 185.00 Its all High from 29th September. ARM has
traded a Great number of shares over the last few Months and might
well be in play.
Bamburi Cement was the 3rd most active Counter and closed 0.48% firmer
at 209.00 where 250,200 shares worth 52.291m were traded.
Portland did not trade.

EABL traded 4th. EABL retreated 0.94% to close at 209.00 and traded a
205.00-211.00 range and 220,300 shares worth 46.245m. Bloomberg
carried a Report in the AM about the Appointment of a New MD for EABL
which was subsequently corrected to a new MD for Serengeti. EABL has
posted a 53.112% 1 Year Return and recently traded 215.00 a shilling
off its 216.00 All Time Closing high from 2008.

Mumias Sugar firmed 0.91% to close at 11.05 and traded a 10.95-11.75
range and 3.746m shares worth 41.558m. Sugar is set to cross 30 cents
on the International Exchanges and has rallied over 100% from Year
Lows but Mumias has post Results diverged from that Trend.

BAT formed 0.355% to close at 281.00 and traded a 270.00-282.00 range
and 54,400 shares worth 15.326m. BAT traded a 285.00 all time high on
28th October and has posted a 64.901% 1 Year Return.

KenolKobil firmed 0.91% to close at 11.05 and traded a 10.95-11.15
range and 477,900 shares worth 5.280m with a 4-1 Demand versus Supply
Imbalance showing signalling further Upside Traction.
Total traded 3,000 shares at 30.50 -1.61%.

KPLC improved 0.45% to close at 224.00 and traded a 223.00-226.00
range and 29,500 shares worth 6.613m. Investors are awaiting Pricing
Data for the Rights Issue. I surmise There will be a Deep Discount.
Kengen eased 0.85% to close at 17.40 and traded a 17.05-17.55 range
and 135,200 shares.
Cables was unchanged at 18.05 and traded 40,800 shares.

Carbacid retreated 2.03% to close at 145.00 and traded 1,600 shares.
BOC Kenya did not trade.
Crown Berger traded 600 shares at 37.00 and unchanged.
Eveready retreated 2.78% to close at 3.50 and traded 59,800 shares.
Sameer closed at 8.10 and traded 6,300 shares.
Unga closed higher at 12.20 and traded 1,000 shares.



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