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Satchu's Rich Wrap-Up
Thursday 29th of March 2012

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

If you are tracking the NSE Do it via RICHLIVE and use Mozilla Firefox
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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 on the Front Page of the site

#Mindspeak 2012 RICH TV

We have hosted The SecGen EAC Dr. @RSezibera and Pierre Trouilhat the
CEO Nestle Equatorial Africa

Macro Thoughts

Home Thoughts

Its been a fascinating Trip with @OdourMartinO and @JoshuaOigara of @KCBGroup

We were in London Monday and Tuesday

1. Greetings from #London Twitpic

2. The Virgin Lounge Heathrow Twitpic

3. New York New York If I can make it there I can make it anywhere Twitpic

4. @OduorMartinO @JoshuaOigara @KCBGroup @ Blakeney #London #Africa Pitch

Elton John - Bennie and the Jets YouTube

I had this on Loop on the Flight over from London

I miss My ladies My Wife My Teenagers and My Little Pussy Cat.

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BRICS agree not bound by "unilateral" sanctions on Iran: SAfrica Reuters
Law & Politics

NEW DELHI (Reuters) - The BRICS group of countries have broadly agreed
they are not bound by "unilateral" sanctions on Iran, measures that
threaten higher global oil prices and could result in supply
shortages, South Africa's trade minister said on Wednesday.

The BRICS group of emerging world powerhouses - Brazil, Russia, India,
China and South Africa - are meeting in New Delhi amid Western
pressure to cut crude imports as part of sanctions designed to halt
Tehran's suspected pursuit of nuclear weapons.

China and India are the biggest buyers of Iran's crude, which they
need to help sustain economic growth in two of the world's
fastest-growing major economies. Trade ministers of both nations on
Wednesday said they would maintain economic ties with Tehran, despite
pressure from Washington.

China disapproves of tougher Western sanctions on Tehran but its
refiners have cut purchases of Iranian crude, albeit because of a
pricing dispute. India too, publicly, has said it will not abide by
unilateral measures while privately telling oil companies to cut
purchases by at least 15 percent -- which they have done.

For its part, South Africa has cut its dependence on buying oil from
Iran, the world's fifth-biggest oil exporter, and is "proactively"
trying to diversify its purchases, Rob Davies told Reuters on the
sidelines of the BRICS summit.

"I think that we all broadly agree with the proposal, the terminology
that was made, that if there are U.N. Security Council sanctions then
we are all bound by that, but if there are sanctions that are imposed
by other countries unilaterally, they shouldn't have to apply to us,"
Davies said, after a meeting of BRICS trade ministers.

"But I think the problem is that we've also got the power relations to
contend with, and that whether we like it or not the decision will
impact on us in the form of higher oil prices and possibly even
shortages of supply. So those are all going to be big challenges that
we're going to face," he added.


The BRICS have Cohones?

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Currency Markets At A Glance WSJ
World Currencies

Euro 1.3320
Dollar Index 79.14
Swiss Franc 0.9049
Pound 1.5893
Japan Yen 82.88
Aussie 1.0394 200-day moving average around 1.0380
India Rupee 50.78
South Korea Won 1137.14
Brazil Real 1.8254
Egypt Pound 6.0446
South Africa Rand 7.6712

Crédit Agricole strategists said: “We do not expect the weak U.S.
dollar bias to persist, especially as it is based on unrealistic
expectations that the Federal Reserve will still implement more
quantitative easing.”



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Commodity Markets At A Glance WSJ

Crude Oil 3 Month Chart INO 105.55 Last

Oil dropped for the first time in four days after the U.S. Energy
Department said inventories climbed the most in 20 months and as
Western nations considered releasing crude from strategic reserves.
Futures fell 1.8 percent as the government said supplies rose 7.1
million barrels to 353.4 million last week, the largest increase since
July 2010. French Industry Minister Eric Besson said the U.S. proposed
releasing oil from strategic reserves. A White House official said no
decision has been made.

“The chatter about a reserve release appears to be an attempt to talk
down the market.”

Crude oil for May delivery declined $1.92 to $105.41 a barrel on the
New York Mercantile Exchange, the lowest settlement since March 22.
Prices are up 6.7 percent this year.

Gold 5 Day Chart 1663.08 Last

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Boom time for Mozambique, once the basket case of Africa Guardian

The shells of stylish colonial-era buildings, like shipwrecks on the
ocean floor, still give Maputo a distinct character. But the capital
of Mozambique no longer feels like an urban museum. Amid the crumbling
grandeur rumble cranes and mechanical diggers, carving out a different

A construction boom is under way here, concrete proof of the economic
revolution in Mozambique. Growth hit 7.1% last year, accelerating to
8.1% in the final quarter. The country, riven by civil war for 15
years, is poised to become the world's biggest coal exporter within
the next decade, while the recent discovery of two massive gas fields
in its waters has turned the region into an energy hotspot, promising
a £250bn bonanza.

The national currency was the best performing in the world against the
dollar. Investment is pouring in on an unprecedented scale; as if to
prove that history has a sense of irony, Portuguese feeling Europe's
economic pain are flocking back to the former colony, scenting better
prospects than at home. Increasingly this is the rule, not the
exception in Africa, which has boasted six of the world's 10
fastest-growing economies in the past decade. The first oil discovery
in Kenya was confirmed on Monday, while the British firm BG Group
announced that one of its gas fields off the Tanzanian coast was
bigger than expected and could lead to billions of pounds of
investment. Bankers, analysts and politicians have never been so
bullish about the continent, which barely 10 years ago was regarded as
a basket case.

From Cape Town to Cairo, there are signs of a continent on the move:
giant infrastructure projects, an expanding middle class, foreign
equity scrambling for opportunities in telecoms, financial services
and products aimed at a billion consumers. Growth is no magic bullet
for reducing inequality or fostering democracy, but the stubborn truth
that it is still the world's poorest continent has done little to dull
the confidence and hype about the African renaissance.

A Mozambican gold miner in Manica province. The wealth of resources in
the southern African country could herald a new era for a people still
recovering from 15 years of civil war. Photograph: Goran


Is East Africa the Next Frontier for Oil? TIME March 2010

"Definitely, there is a sense that there are discoveries to be had,"
says Aly-Khan Satchu, a financial adviser who runs Rich Management in
Nairobi. "The reality and the perception of risk are narrowing."

My Weekly Piece EAC Stop the Borders Mentality The Star

THIS sensitivity to the border issue, this untiring enthusiasm for
constantly marking them out, widening them or defending them, are
characteristic not only of man, but all animate nature. Even our quiet
and meek kitten labors to squeeze out a few drops with which to mark
the borders of his territory. And our brains? Encoded in them, after
is an infinite diversity of borders. Between the left and the right
hemispheres, between the frontal and the temporal lobes, between the
corpus callosum and the cerebellum.... Notice the way in which we
think. That’s the limit, beyond that - no. Moreover, all these
boundaries of thought and feeling, injunctions and interdictions are
constantly shifting. Hence our headaches and migraine, hence the
tumult in our heads: but pearls can also be produced: visions,
dazzlements, flashes of inspiration, and - unfortunately, more rarely,

In short, that which is most desired, awaited and longed for by
everyone is precisely this unconditional, total, absolute –
boundlessness - Ryszard Kapucinski Imperium,1993.

I started my introduction to EAC Secretary General, Richard Sezibera,
Mindspeak session by quoting Kapucinski.

The ambassador started his presentation by saying: “This is Africa’s
century. The challenge is that we need to own it”.

He is right. I happen to believe we are sitting on a lake of
hydrocarbons from Mozambique all the way up to Somalia. This lake of
obviously reaches inland and as far as the Lake Albert Basin in
Uganda. The EAC has a surface area (incl. water) of 1.82 million sq.
km, a GDP (market prices) of $79.2 billion and a GDP per capita $685.
The population is 133.1 million. And though I started with the
hydrocarbon resource by now you know I believe it is what walks upon
the ground more than what can be dug out of the ground, which is
infinitely more valuable.

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South Sudan troops withdraw from oil area after clashes Reuters
Minerals, Oil & Energy

HEGLIG OIL FIELD, Sudan (Reuters) - South Sudan's troops have pulled
out of Sudan's oil-producing Heglig area, both sides said on
Wednesday, easing tensions after two days of clashes between the
neighbours threatened to escalate a simmering conflict.

Both the United States and United Nations called on the countries to
halt the violence - the worst seen since South Sudan declared
independence from Sudan in July, taking most of the country's known
crude reserves with it.

South Sudan accused Sudan of bombing major oil fields and other areas
on its side of the border on Monday and Tuesday. Sudan denied the air
raids but said southern troops started the fighting by attacking
Heglig, one of the major oilfields left on the Sudanese side of the
border since the split.

A Reuters reporter taken on a Sudanese government tour of the Heglig
oil field near the border saw no signs of fighting on Wednesday, but
there was a heavy security presence. Soldiers and machine gun-mounted
Toyota pickup trucks patrolled the area.

"The area of Heglig and the surroundings are totally secure," Heglig
area commander Bashir Meki told reporters. "We are ready (to defend
our country)," he said, as dozens of soldiers shouted "Allahu Akbar"
(God is greatest).


They appear intent on a messy and acrimonious Divorce.

South Sudan explains the Pipeline Wars #Africa 30 second Video IGAD
Horn of Africa Conference

Khartoum responds to Juba Pipeline Wars #Africa 30 seconds Video IGAD
Horn of Africa Conference

South Sudan's oil cutoff: brilliant negotiating, or suicide? CS Monitor

By Aly-Khan Satchu January 30, 2012

The current stand off between Sudan and a newly independent South
Sudan made me recall an anecdote told by Henry Kissinger, after a
series of negotiations with Syrian President Bashar al-Assad's father,
the late President Hafez al-Assad.

“Assad never lost his aplomb. He negotiated daringly and tenaciously
like a riverboat gambler to make sure that he exacted the last sliver
of available concessions. I once told him that I had seen negotiators
who deliberately moved themselves to the edge of a precipice to show
that they had no further margin of maneuver. I had even known
negotiators who put one foot over the edge, in effect threatening
their own suicide. He was the only one who would actually jump off the
precipice, hoping that on his way down he could break his fall by
grabbing a tree he knew to be there. Assad beamed.”

I will leave it to you to calculate who might be Hafez: South Sudan's
President Salva Kiir or Sudanese President Omar al-Bashir? Or both?

South Sudan's top negotiator, Pagan Amum told reporters in Addis Ababa
Saturday: "Tomorrow the [oil] shutdown will be complete and what will
be remaining to be done the day after is finishing the cleaning and
flushing of facilities." South Sudan is shutting down its oil
production, last put by officials at 350,000 barrels per day in
November. Approximately 99 percent of the new state's income is from
the sale of oil.

Earlier in the week, South Sudan's Information Minister Barnaba Marial
Benjamin announced that South Sudan and Kenya had signed a memorandum
of understanding to build an oil pipeline to the Kenyan port of Lamu.
Construction of the pipeline will begin “as soon as sources of funding
are made available,” which should take about a month, he said.

Minister Benjamin is reckoning that the pipeline could be completed in
10 months. That's a bullish call. The biggest problem is surely the
sky-high risk of asymmetric guerrilla-type sabotage. I would think
it's highly likely. Therefore, insurance for the pipeline might well
prove punitive. However, the point remains that we in Kenya have an
embedded geopolitical advantage in this region, that being the route
to the sea. It is like the jugular vein for many of our East African

Neither Juba or Khartoum are ranked AAA by credit rating agencies.
Khartoum has lost a great chunk of their revenues. The South,
meanwhile, can hardly afford to lose the cash flow that comes from the
sale of its 350,000 barrels per day. And that's why I started with
Henry Kissinger's description, "I had even known negotiators who put
one foot over the edge, in effect threatening their own suicide."

Now, there is a back story to this. You see, through 2011, Sudan
provided China with 5 percent of its total oil imports. You will
recall that 35,000 Chinese workers were evacuated out of Libya in nine
days last year and China was rolled back and right out of Libya. Not
so long ago, President Obama authorized the deployment to Uganda of
approximately 100 combat-equipped US forces to help regional forces
ostensibly to “remove from the battlefield” – meaning capture or kill
– Lord’s Resistance Army leader Joseph Kony.

Then in January this year, President Barack Obama issued this memorandum.

"By the authority vested in me as President by the Constitution and
the laws of the United States, including section 503(a) of the Foreign
Assistance Act of 1961, as amended, and section 3(a)(1) of the Arms
Export Control Act, as amended, I hereby find that the furnishing of
defense articles and defense services to the Republic of South Sudan
will strengthen the security of the United States and promote world
peace," said the official text of Obama's decision.

It seems to me Sudan has become the epicenter of the US and China's
collision in Africa and that we are watching a 21st-century,
high-stakes proxy war. I have to surmise that the US is underwriting
Salva's overdraft, what with all these demobilized soldiers roaming
around Juba, it would be suicide to have them unpaid for any length of
time. I wonder who is underwriting Bashir? Maybe, he is calling in
favors in Libya?

Aly-Khan Satchu is the CEO of the East African financial portal
http://www.rich.co.ke and can be followed on Twitter @alykhansatchu

The River #Nile seen from #Juba #Sudan Twitpic

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South Africa Credit-Rating Outlook Cut to Negative by S&P Bloomberg
World Of Finance

South Africa’s credit-rating outlook was cut to negative by Standard &
Poor’s because of slower economic growth and a risk the government may
not be able to control spending to rein in the fiscal deficit. The
rand dropped the most in almost a week.

The foreign-currency debt rating of BBB+ was affirmed and the outlook
was reduced from stable, S&P said in an e-mailed statement today. The
rating is the third-lowest investment grade and in line with Thailand,
Kazakhstan and Ireland. Fitch Ratings and Moody’s Investors Service
have lowered their outlooks since November.

“There are issues of public-sector wages that could increase going
forward that could put pressure on fiscal planning,” Christian Esters,
director in the Africa sovereign ratings team, said by phone from
Frankfurt today. “There are some underlying risks, also related to
gross domestic product growth.”

South African economic growth will slow to 2.7 percent this year,
according to the government, as Europe falls into recession, reducing
demand for manufactured goods from the continent’s largest economy.
Job creation has lagged, keeping South Africa’s unemployment rate the
highest of 61 nations tracked by Bloomberg.

The currency dropped as much as 1.4 percent, the most in two weeks, to
7.7089 per dollar, and was trading at 7.6890 by 7:37 p.m. in

The Treasury forecast on Feb. 22 the budget deficit will narrow to 4.6
percent of gross domestic product in the fiscal year through March
2013 and 3 percent by 2015. It has estimated a lower-than-inflation
increase in state-worker wages of 5 percent.

“Fundamental structural economic and social problems continue, such as
very high unemployment and a structural current-account deficit that
makes the economy dependent on external financing,” S&P said in a

S.Africa Treasury disagrees with S&P assessment Reuters

South Africa disagrees with S&P's assessment of the political risk in
the country, and political debate should not be confused with
instability, the Treasury said on Wednesday.

The ratings agency S&P downgraded the country's outlook to negative
from stable, saying this reflected the potential for a ratings
downgrade if economic and social problems fed into the political
debate ahead of 2014 elections.

"Political debate and a vigorous exchange of ideas on policy options
are part and parcel of the fibre of a democratic dispensation. This
cannot be construed as political instability," the Treasury said in a


There is also a  Blow Back Risk from the Mugabe Zimplats Grab which is
further unsettling Investors.

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MTN Promised Money, Weapons, UN Votes in Iran, Rival Says Bloomberg
Information & Communication Technology

MTN Group Ltd., Africa’s largest mobile-phone operator, bribed
officials, arranged meetings for Iran with South African leaders, and
promised Iran weapons and United Nations votes in exchange for a
license to provide mobile phone service in the Islamic Republic,
Turkcell Iletisim Hizmetleri AS (TCELL) alleged in a lawsuit.

Turkcell, which initially was awarded the Iranian cell phone license
in 2004, sued MTN today in federal court in Washington, attaching
documents it alleges are internal MTN memos outlining the South
African company’s actions to wrest the Iranian business away from

The alleged MTN memos codenamed the effort “Operation Snooker” and
described payoffs to Javid Ghorban-oghli, then Iran’s deputy foreign
minister, and Yusuf Saloojee, South Africa’s ambassador to Tehran at
the time. In the memos, company executives codenamed the men “Long-J”
and “Short-J.”

MTN prevailed upon the South African government to abstain from three
votes on Iran’s nuclear energy program at the United Nations’
International Atomic Energy Agency in Vienna in 2005 and 2006,
according to the complaint. Turkcell alleges the Iranian
communications ministry told MTN it was withholding its license until
it saw how South Africa voted at an upcoming IAEA meeting.

South Africa’s representative to the IAEA, Abdul Minty, abstained from
an IAEA vote on Iran on Nov. 24, 2005. The license was delivered three
days later, the complaint states.

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Kenya T-bills yields dip at latest sale Reuters
Kenyan Bills & Bonds - Short Term

The average weighted yield on Kenya's 182-day Treasury bills edged
down to 17.660 percent from 17.726 percent last week, the central bank
said on Wednesday.

The yield on the 91-day paper fell to 16.728 percent at the same sale
from 17.006 percent the previous week.

The central bank received bids worth 4.5 billion shillings for the 3
billion shillings ($36 mln) it offered in six-months bills,
representing a subscription rate of 149 percent, it said.

The 4 billion it offered in three-months bills received bids worth 1.2
billion shillings or 30 percent. It accepted all the bids for both


Moving in the right Direction.

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Athi River Mining FY 2011 PBT + 22% Earnings Here
N.S.E Equities - Industrial & Allied

Par Value:                  5/-
Closing Price:           161.00
Total Shares Issued:     99,060,000
Market Capitalization:        0
EPS:            11.6
PE:                 0.000

52wk Range:    137.00 - 196.00    
1-Yr Rtn:    -0.86%

Swot Analysis FY 2011 versus FY 2010
Turnover 8.180992b versus 5.964670b +37%
PBT 1.362912b versus 1.112962b +22%
PAT 1.150498b versus 1.075268b +7% 2010 PAT Restated
Earnings Per Share 11.6 versus 10.9 +7%
Final Dividend 2.00 versus 1.75


Cement Sales +72%
ARM to issue a $50m Convertible with a 268.00 Conversion Price


They continue to accelerate via a Bulking Up -

Swot Analysis FY 2010 versus FY 2009
Turnover 5.96467 Billion versus 5.144822 Billion +16%
PBT 1.112962B versus 0.948714b +17%
PAT 0.792011B versus 0.645774B
EPS 8.00 versus 6.52 +22.699%
Dividend 1.75 versus 1.50 +16.666%
Cumulative Average Growth Rate of 31% over last 5 Years in EPS

The firm said a 750,000 tonnes per year cement grinding plant in
Tanzania's commercial city of Dar es Salaam would be on stream before
the end of this year, while another 1.5 million tonne per year plant
would be commissioned in mid-2012.This is after the company's cement
grinding capacity more than doubled to 1 million tonnes per year last
year.The company expects to increase cement sales significantly in 2011.


Their Execution is Flawless and hence the PE Premium

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Nairobi ^NSE20 Bloomberg
N.S.E General

The main NSE-20 Share Index gained 0.8 percent to 3,367.23 points, a
two-week high last touched on March 12, when it closed at 3,399.97
points. Shares in the supermarket chain Uchumi rose 7.1 percent to
12.05 shillings, a nine-month high last touched on June 6, due to
expectations that the firm will give out a dividend after a good
performance for the full-year ending June, traders said.

Navigate any of the listed Shares at the Nairobi Securities Exchange Here

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by Aly Khan Satchu (www.rich.co.ke)
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March 2012

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