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Satchu's Rich Wrap-Up
 
 
Wednesday 23rd of October 2013
 
Morning
Africa

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Africa Reflections on the State of the Now
http://roba.the-star.co.ke/news/article-140464/africa-no-longer-hopeless

It's never been and probably never will be a linear progression but
clearly what were once small pockets of acceleration have broadened
out and not too long ago the Economist pointed out that six of the
fastest growing economies in the World are in Africa.

The point to understand is that the African emergence is a relatively
recent phenomenon. The challenge for many African governments is going
to be of  a very youthful population wanting it now.

This new generation is surfing the c21st via their mobile phones and
their needs and wants are a multiple of any preceding generation.

This new generation will reshape and force the reconfiguration of
governments across Africa as they are forced to react to a new normal
[of heightened expectations amongst its citizens.

Now an electorate can have heightened expectations but simply no
leverage with which to pressure its government.

Today the pressure points are growing exponentially.

For three whole days during the Westgate crisis, the hashtag
#StepasideOlelenku was the top trending hashtag in this region.

I feel sorry for the cabinet secretary because I suspect some
undiluted old guard elements probably whispered ''Say This'' and ''Say
That'' with no regard or even comprehension of the new normal and
little regard for the fact that they were shredding the cabinet
secretary's bona fides.

The electorate is breaking out of its box. PWC in its Africa Business
Agenda Report 2013 noted;

''A significantly higher percentage of CEOs in Africa recognise the
power of social media users compared to their global counterparts.''
And ''of the critical influence of the social media on public
perceptions.''

The mobile phone [The Financial Times recently reported that in a
seven-year period mobile phone subscriptions had risen to 475 million
from 90 million in sub-Saharan Africa] has been a silver bullet and a
game changer, it has been very grass roots [Anyone can own one] and it
has been the catalyst for creating a new communications ecosystem.

Of course, the failure to award the African Leadership Prize for the
4th Occasion out of 7 captured headlines but what caught my attention
was this; The Rule of Law and Safety Index [In country and not cross
border conflict related] was the only index which has deteriorated.

The World Economic Forum also made a similar finding. This is an alarm
bell and I think speaks to a consequence of a failure to meet the
rising expectations of our people.

Our societies more urbanised than ever before are becoming more
personally dangerous and it appears to be a Sub Saharan wide
phenomenon. Its not an external challenge but an internal fissure.

Ibrahim said "We should not rush into thinking that improvement will
happen instantly. Don't forget it took China 40 years to get where it
is now" Unfortunately, I know of no one who has a 40 year time
horizon.These are interesting and very fluid times.

read more


This Saturday 26th October #Mindspeak at @InterConNairobi
Africa


#Mindspeak Panel Discussion to cover The Extractive Industries #Oil #Gas Mining

read more


Voluntary Principles on Security and Human Rights
Africa


The Voluntary Principles are the only human rights guidelines designed
specifically for extractive sector companies. Participants in the
Voluntary Principles Initiative -- including governments, companies,
and NGOs -- agree to proactively implement or assist in the
implementation of the Voluntary Principles.

The Extractive Industries Transparency Initiative #EITI
http://eiti.org/eiti

The EITI maintains the EITI Standard. Countries implement the EITI
Standard to ensure full disclosure of taxes and other payments made by
producing oil, gas and mining companies. These payments are disclosed
in an annual EITI Report (to see all EITI Reports, go to
datat.eiti.org). This report allows citizens to see for themselves how
much their government is receiving from their country's natural
resources.

Transparency can only lead to accountability if there is understanding
of what the figures mean and public debate about how the country's
resource wealth should be managed. Therefore, the EITI Standard
requires that EITI Reports are comprehensible, actively promoted and
contribute to public debate.

read more


#Mindspeak 2013 RICH TV
Africa


features @dreynders @IMFNews @johngithongo @MaggieIreri
@patriciaithau1 @HabilOlaka

read more


I thank @Gina_Din for the Invitation yesterday to the Kempinski
Africa


Macro Thoughts

Home Thoughts

The accelerating velocity of change in the digital age

A project called Shadow, which by means of a free app, available in
December, intends to archive the dreams of people around the world
http://www.newyorker.com/talk/2013/10/28/131028ta_talk_wilkinson

Soik said, "If you don't record the dream, you don't remember it. When
you record it, you can read a dream from a year ago and remember where
you were and how you felt. But if I ask you what did you dream about a
year ago, you don't know. That's invisible data, in our opinion, and
what we like is the idea of making the invisible visible. We feel this
is a huge data set that is literally forgotten every night if it's not
written out. What we're trying to do is build a community of dreamers,
and if we do this right it will be here for a very long time."

"There is nothing like a dream to create the future." - Victor Hugo

Look, boys, it ever strike you that the world not real at all? It ever
strike you that we have the only mind in the world and you just
thinking up everything else? Like me here, having the only mind in the
world, and thinking up you people here, thinking up the war and all
the houses and the ships and them in the harbour. That ever cross your
mind?

V. S. NAIPAUL, Miguel Street
http://upload.wikimedia.org/wikipedia/en/9/91/MiguelStreet.jpg

"You have wakened not out of sleep, but into a prior dream, and that
dream lies within another, and so on, to infinity, which is the number
of grains of sand. The path that you are to take is endless, and you
will die before you have truly awakened."
-- Jorge Luis Borges

"The mind was dreaming. The world was its dream."
-- Jorge Luis Borges

The Power of Nightmares Adam Curtis
http://www.youtube.com/watch?v=EaLPFayD8FA

"Untitled (Girl with Red Sneakers)" 2013, by Kelvin Hady, from
Manhattan, an eighteen-year-old student at High School for Media and
Communications Photo Booth
http://www.newyorker.com/online/blogs/photobooth/2013/10/slide-show-high-school-students-photographs-at-the-studio-museum-of-harlem.html#slide_ss_0=7

read more



Washington allegedly told Riyadh the US would not be able to defend the Shi'ite majority, oil-rich Eastern Province if the Tomahawks started flying over Syria
Law & Politics


Conclusions

Saudi Arabia has become a lot more forthright of late but rumours of
the Demise of the US Saudi Arabia are seriously overblown.

China's massive foreign investment, in one map
http://www.smartplanet.com/blog/bulletin/chinas-massive-foreign-investment-in-one-map/32525

read more



Currency Markets at a Glance WSJ
World Currencies


Euro 1.3770  Euro touched $1.3793 per euro highest since November 2011
Dollar Index 79.23 Dollar Index will first test support at 78.92, the
gauge's 2013 low, before testing last year's September low of 78.60
Japan Yen 97.44
Swiss Franc 0.8953
Pound 1.6216 Sterling reached $1.6257 the strongest since Oct. 1.
Aussie 0.9646 reached 97.58, a level unseen since June 4.
India Rupee 61.525
South Korea Won 1057.14
Brazil Real 2.1728
Egypt Pound 6.8906
South Africa Rand 9.7749

The euro has risen 1.3 percent in the past month against a basket of
developed-nation currencies tracked by Bloomberg Correlation-Weighted
Indexes, the best performance after the Australian dollar's 1.7
percent jump. The greenback has fallen 1.1 percent in the same period,
while the yen has climbed 0.6 percent.

Euro versus the Dollar 3 Month Chart 1.3770 [headed to 1.400]
http://quotes.ino.com/charting/index.html?s=FOREX_EURUSD&v=d3&t=c&a=50&w=1

Dollar Index 3 Month Chart INO 79.23 [headed to 78.60]
http://quotes.ino.com/charting/index.html?s=NYBOT_DX&v=d3&t=c&a=50&w=1

Dollar Yen 3 Month Chart INO 97.44
http://quotes.ino.com/charting/index.html?s=FOREX_USDJPY&v=d3&t=c&a=50&w=1

read more


Commodity Markets at a Glance WSJ
Commodities


Gold 1 Year Chart INO 1336.24 [Deferred Taper refers]
http://quotes.ino.com/charting/index.html?s=FOREX_XAUUSDO&t=c&a=50&w=1&v=d12

Crude Oil 6 Month Chart INO 97.79 [down for the 3rd consecutive session]
http://quotes.ino.com/charting/index.html?s=NYMEX_CL.Z13.E&v=d6&t=c&a=50&w=1

Emerging Markets

Frontier Markets

read more


'Renamo attack' on Mozambique's Maringue police station BBC
Africa


Mozambique's opposition Renamo movement has attacked a police station
in the central town of Maringue a day after annulling a 1992 peace
accord with the government, officials say.

Police are said to have fled their posts after gunmen opened fire and
there are no reports of casualties.

A Renamo spokesman said party leader Afonso Dhlakama had "lost control
of the situation".

http://www.clubofmozambique.com/solutions1/sectionnews/data/mozambique/afonso_dhlakama.jpg

The United States on Tuesday urged Mozambique's government and the
Renamo opposition movement to "move back from the brink"

http://www.reuters.com/article/2013/10/22/us-mozambique-renamo-usa-idUSBRE99L1GK20131022

A lateen-rigged dhow in the azure waters of the Bazaruto
Archipelago in southern Mozambique. All photos by Marcus and Kate
Westberg

http://newswatch.nationalgeographic.com/2013/09/23/island-hopping-by-traditional-dhow-in-mozambique/

Maputo Boom Town 4th June 2012

http://www.rich.co.ke/media/docs/040NSX0406.pdf

Of course, Mozambique has popped large onto the global radar because
of gas reserves that have been discovered offshore and in the deep
sea.

Sunset Maputo Harbour Mozambique #Africa

http://www.twitpic.com/9s2c0i

South Africa All Share Bloomberg +19.29% 2013 Record All Time Highs

http://www.bloomberg.com/quote/JALSH:IND

Dollar versus Rand 6 Month Chart INO 9.7806

http://quotes.ino.com/charting/index.html?s=FOREX_USDZAR&v=d6&t=c&a=50&w=1

Egypt Pound versus The Dollar 3 Month Chart INO 6.8904

http://quotes.ino.com/charting/index.html?s=FOREX_USDEGP&v=d3&t=c&a=50&w=1

Egypt EGX30 Bloomberg +16.18% 2013 [January 2011 Highs]

http://www.bloomberg.com/quote/CASE:IND

Nigeria All Share Bloomberg +37.29% 2013

http://www.bloomberg.com/quote/NGSEINDX:IND

Ghana Stock Exchange Composite Index Bloomberg +76.01%

http://www.bloomberg.com/quote/GGSECI:IND

Arabic, English and Swahili are among the six languages spoken by
Ikrima, and he studied French for two years at the Alliance Francais
in Nairobi, his friends say.

http://www.reuters.com/article/2013/10/22/us-kenya-icc-un-idUSBRE99L14O20131022

Reports by Kenya's National Intelligence Service say Ikrima, who is
Kenyan, was "coordinator" of a cell including Ms. Lewthwaite and
Jermaine Grant, that planned "multiple attacks" on targets in Nairobi
in late 2011 and early 2012.

http://www.csmonitor.com/World/Security-Watch/2013/1008/Britain-s-shadowy-White-Widow-linked-to-SEAL-team-target-in-Somalia

Doting mother: Lewthwaite poses with her two sons Abdullah and
Abdur-Rahman. The eldest, Abdullah, is the son of 7/7 bomber Germaine
Lindsay Daily Mail

http://www.dailymail.co.uk/news/article-2471355/White-Widow-Samantha-Lethwaite-Doting-mother-worlds-wanted-woman.html

read more


African leaders ask U.N. to defer Kenya international criminal trials
Kenyan Economy


The African Union and Kenya asked the U.N. Security Council on Tuesday
to defer the trials of Kenya's leaders at the International Criminal
Court for one year so they can deal with the aftermath of the Nairobi
mall attack.

In a letter to the council obtained by Reuters, African leaders said
the legal proceedings against President Uhuru Kenyatta and his deputy
William Ruto "will distract and prevent them from fulfilling their
constitutional responsibilities, including oversight for national and
regional security affairs."

The AU requested that their trials be deferred "in order to provide
them with the time required for the enhancement of the efforts aimed
at combating terrorism and other forms of insecurity in the region."

At least 67 people were killed when al Qaeda-linked group al Shabaab
attacked Nairobi's Westgate shopping center last month.

In a separate letter, Kenya's U.N. Ambassador Macharia Kamau said that
when considering the deferral request, the 15-member Security Council
should take into account the "threat to the peace, breach of the peace
or act of aggression likely to transpire in light of the prevailing
and continuing terrorist threat existing in the Horn of and Eastern
Africa."

The Security Council can defer ICC proceedings for one year under
Article 16 of the Rome Statute that established The Hague-based court
a decade ago. The council would need to adopt a resolution to take
that step.

read more


I&M share Price data here
Kenyan Economy


Par Value:
Closing Price:           102.00
Total Shares Issued:          363722034.00
Market Capitalization:        37,099,647,468
EPS:             1.69
PE:                60.355

I&M reports 11 Month Earnings through June 2013 here
http://www.rich.co.ke/media/docs/I_M%20Holdings%20Ltd%20-%20unaudited%20interim%20financial%20results.pdf

11 Months through 30th June 2013 versus 12 months through June 2012
Total Operating Income 758.829m versus 57.465m +1,320%
Admin and Operating Expenses [16.713m] versus [5.508m]
11 Months PBT 742.116m versus 51.957m
11 Months PAT 741.646m versus 48.420m +1,531%
EPS 1.89 versus 1.69 +11.834%

Conclusions

On a Trailing PE of 60.355, Investors are taking a lot of the Growth
Story on Trust.

read more


Carbacid Investments reports FY 2013 PAT +22.15% Earnings here
Kenyan Economy


Par Value:                  5/-
Closing Price:           145.00
Total Shares Issued:          33980000.00
Market Capitalization:        4,927,100,000
EPS:            13.99
PE:                 10.36

Local carbon dioxide company.

FY Earnings through 31st July 2013

FY Turnover 952.836m versus 921.753m +3.372%
FY Profit Before Tax 634.686m versus 535.444m +18.534%
FY PAT 475.541m versus 389.287m +22.15%
Final Dividend 3 shillings a share Total FY PayOut 6.00 a share and unchanged
FY Earnings Per Share 13.99 versus 11.46 +22.076%

Company Commentary

Proposing an increase of the Authorised Share Capital to 1,000,000,000
A Bonus of 1 share for every 2 held
A Subdivision of each share of 5/= into 5 of 1/= each.

Conclusions

Its an inexpensive share on a PE of 10.36.

read more



#Westgate from @CNBCAfrica #Nairobi Bureau on the 19th Floor
Kenyan Economy


The latest Central Bank of Kenya (CBK) data shows that mobile payments
grew 21.8 per cent to Sh1.2 trillion at the end of August compared to
Sh987.2 billion during a similar period last year.

http://www.businessdailyafrica.com/Mobile-money-transfers-shoot-up-despite-tax-/-/539552/2043490/-/e8k3siz/-/index.html

"The continued growth of mobile money is largely attributed to growing
ubiquity of the service," said Bob Collymore, chief executive of
Safaricom, which has 17.1 million users on the M-Pesa network.

Nick Brandt Photography
http://i.telegraph.co.uk/multimedia/archive/01479/nickbrandt_1479762c.jpg

Nick Brandt Photography
http://alafoto.com/wp-content/uploads/opa12.jpg

Kenya Shilling versus The Dollar Live ForexPros 84.799
http://j.mp/5jDOot

Nairobi All Share Bloomberg  +38.129% 2013

http://www.BLOOMBERG.COM/quote/NSEASI:IND

Nairobi ^NSE20 Bloomberg +19.6184% 2013

http://j.mp/ajuMHJ

Every Listed Share can be interrogated here

http://www.rich.co.ke/rcdata/nsestocks.php

read more



 
 
N.S.E Today


The Rally seen in Nairobi, The Nairobi All Share is +91.62% since
January 2012, is actually an Africa Wide Phenomenon.
The South Africa All Share closed at an All Time High yesterday, Egypt
is at a January 2011 High, Ghana has set a Sequence of All Times,
Nigeria is at a more than 5 Year High.
The Rally has been largely driven by International Investors upsizing
a previously egregiously underweight Weighting for SSA Equities to a
less egregious weighting.
That Process has much more to run and underpins SSA Equity Markets.
I expect an average Rally of 5%-10% across Africa Equities Indices
through Year End.
The Nairobi All Share firmed 0.4044% to close at 131.56.
The All Share is +38.68% in 2013 and just 1.52% below its 2013 and All
Time Closing High reached on the 8th of October this Year.
The Nairobi NSE20 firmed 10.01 points to close at 4953.84.
The Nairobi NSE20 will threaten its 2013 and Multi Year High Closing
High of 5030.91 from April 2nd this Year.
Equity Turnover was more vigorous at 789.448m versus 343.353m previously.
Safaricom traded 51.69% of the Volume today and firmed 1.12%.
Carbacid rallied +58.621% after the Release of its FY Earnings
yesterday. There is no Daily Limit [10% typically] after a material
announcement.
The Shilling was last trading at 84.749 and will strengthen towards 84.00.
The Retreat in the Price of Crude Oil is singularly helpful.



N.S.E Equities - Commercial & Services


Safaricom was the most actively traded share at the Securities
Exchange and firmed +1.12% to close at 9.05 and traded 45.102m shares
worth 408.089m and 51.69% of the Total Volume transacted at the
Securities Exchange today. Safaricom is +79.20% this Year and will
test its all Time Closing High of 9.40 reached on the 8th of this
month. High Volume Action around the 9.00 Level confirms 9.00 as a
Price Support Level. The latest Central Bank of Kenya (CBK) data shows
that mobile payments grew 21.8% to Sh1.2 trillion at the end of August
compared to Sh987.2 billion during a similar period last year and that
informs Investors that M-Pesa which expanded FY Revenues +29.5% to
21.84b is set to stay on that elevated Trajectory.

ScanGroup closed unchanged at 58.00 and traded 501,800 shares worth
29.103m. ScanGroup reported a -82.509% slide in H1 2013 Profit Before
Tax and it is that Headline Number which pressured the Price.
ScanGroup sits 32.44% below the Price that @WPP's Cavendish Holding is
going to pay for more than 20m shares and as part of the Transaction
that will place @WPP into a Majority shareholder Position. The @WPP
Network Effect is currently priced at near zero.

Kenya Airways where the CEO Dr. Titus Naikuni is in Seattle preparing
for the Delivery of Kenya Airways' largest aircraft ever the Boeing
777-300ER to Nairobi on Friday, firmed +0.48% to close at 10.45 and
traded 461,700 shares. Kenya Airways broke Key Price Resistance of
10.00 on the 1st of October. 10.00 had capped Kenya Airways since mid
June and hence the Surge through that Level was an important Chart
Break Out. Dr. Naikuni has steered Earnings Expectations towards a FY
Profit, the share price has plenty further to go.

Uchumi firmed 1.19% to close at 21.25 and traded 40,500 shares. Supply
has thinned out.



N.S.E Equities - Finance & Investment


Equity Bank eased 1.41% to close at 35.00 and traded good sized volume
of 3.775m shares worth 132.879m. Equity Bank is +47.36% in 2013 and
trades on a Trailing PE Ratio of 10.736.



N.S.E Equities - Industrial & Allied


Carbacid surged +58.621% to close at 230.00 and traded shares as high
as 250.00 +72.413%. Carbacid traded 19,600 shares. Carbacid released
solid FY Results yesterday where FY Turnover expanded +3.372%, FY 2013
Profit After Tax accelerated +22.15%, the Dividend Pay Out Ratio was
maintained unchanged Year on Year. The Catalyst for the Outstanding
Bull Move was The Proposal to offer a Bonus Share for every two held
and then a 5-1 Ratio Split. After Todays Price Surge, Carbacid trades
on a PE Ratio of 16.44.

Carbacid Investments FY Earnings Release FY 2013 PAT +22.15%
http://www.rich.co.ke/rcdata/company.php?i=MzA%3D

FY Earnings through 31st July 2013
FY Turnover 952.836m versus 921.753m +3.372%
FY Profit Before Tax 634.686m versus 535.444m +18.534%
FY PAT 475.541m versus 389.287m +22.15%
Final Dividend 3 shillings a share Total FY PayOut 6.00 a share and unchanged
FY Earnings Per Share 13.99 versus 11.46 +22.076%

Company Commentary

Proposing an increase of the Authorised Share Capital to 1,000,000,000
A Bonus of 1 share for every 2 held
A Subdivision of each share of 5/= into 5 of 1/= each.

EABL firmed 0.633% to close at 319.00 and traded 112,600 shares worth
36.009m. EABL remains a 'Must Have' Stock for International Investors
who have looked through the Full Year Earnings Noise.

BAT firmed 0.18% to close at 571.00 and traded 41,100 shares worth
23.49m. BAT is +17.73% in 2013 and that excludes Dividend Payments and
last year BAT paid out 98.8% of its Earnings Per share in Dividends.

KenGen eased 0.295% to close at 16.95 and was trading at 16.75 -1.47%
at the Finish Line. KenGen traded 1.253m shares.

East African Portland Cement rallied +6.5% to close at 65.50 and
traded 14,100 shares.

KenolKobil firmed a further 1.08% to close at 9.35 and traded 2.003m
shares. KenolKobil has rallied with Purpose and on heavy Action from
levels of 8.00.

--



by Aly Khan Satchu (www.rich.co.ke)
 
 
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October 2013
 
 
 
 
 
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