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Satchu's Rich Wrap-Up
Monday 17th of March 2014

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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

I thank Angel Jones and her Team at the Homecoming Revolution for a super Event.

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Looking forward to @homecomingrev #LondonExpo2014 @olympia

Macro Thoughts

Home Thoughts

It was a Pleasure catching up with My Friend Alexander Michaelis and
his Mother Nina and Family. Thank You.

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We managed to go to Loftus Road on Saturday afternoon and watch QPR.

It was a Pleasure catching up with Nishet's Brother and his Wife.

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More than 95% of Crimean voters backed joining Russia, local officials said. Moscow says it will accept the result BBC
Law & Politics

US President Barack Obama has warned Moscow that Washington is also
ready to impose "costs" over its actions in Ukraine.

Earlier, the EU said in a statement that the vote was "illegal and
illegitimate and its outcome will not be recognised".

Sergei Aksyonov, Crimea's leader installed last month after the
Russian takeover, appeared on stage in Crimea's regional capital

Backed by the Russian national anthem, Russian flags, and the
personnel of Russia's Black Sea fleet, he told supporters that Crimea
was "going home".


As I said it is a Fait Accompli.

Crimea Map via the BBC


"We would want to be sure we are welcomed with flowers" before
annexing any territory in eastern Ukraine, Kremlin analyst Sergei
Markov told Bloomberg News yesterday.


"We can rule out that Putin will limit himself to Crimea," Joerg
Forbrig, a senior program officer at the Berlin bureau of the German
Marshall Fund of the U.S., said in a phone interview.


"There is no prospect of self-restraint on the part of Putin's Kremlin."

What happens next? On Thursday I met with Sergey Aksionov, Crimea's
self-apponted "prime minister," and asked him that. "Nothing at all
will happen," he said, with a disingenuous seeming shrug of the


In other words, Crimea would join Russia--and that would be that.

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@zbig The Grand Chessboard and Ukraine
Law & Politics

"Ukraine, a new and important space on the Eurasian chessboard, is a
geopolitical pivot because its very existence as an independent
country helps to transform Russia. Without Ukraine, Russia ceases to
be a Eurasian empire."

"However, if Moscow regains control over Ukraine, with its 52 million
people and major resources as well as access to the Black Sea, Russia
automatically again regains the wherewithal to become a powerful
imperial state, spanning Europe and Asia."

"Ukraine, Azerbaijan, South Korea, Turkey and Iran play the role of
critically important geopolitical pivots," he wrote in The Grand
Chessboard, a book viewed by many as a blueprint for US world

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Putin likes to think of himself as a geopolitical grandmaster [He is]
Law & Politics

When People start bandying around the Hitler Comparison You know he is
winning big time.

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Reports suggest person who sent 'All right, good night' message from MH370 knew system had been shut down
Law & Politics

Najib said Saturday that the flight was still communicating with
satellites until 8:11 a.m. -- 7 1/2 hours after takeoff, and more than 90
minutes after it was due in Beijing.


#MH370 Doomed: This picture emerged of the plane which would later
go missing while flying between Kuala Lumpur and Beijing


The last satellite transmission from a Malaysian airliner missing for
a week has been traced to the Indian Ocean off Australia, far from
where searches have taken place, according to a person familiar with
the analysis.


A path from Malaysia to the ocean off Australia would have taken as
much as 3,000 miles, about the maximum distance the Boeing Co. (BA)
777-200 could have flown with its fuel load.

Flight 370 may have flown beyond its last known position about 1,000
miles west of Perth, and that location may not be an indication of
where the plane ended up, said the person, who spoke on condition of
not being named because of the sensitivity of the information.

Nice job by @WNYC plotting all 634 runways there were apparently in
range for #MH370 @nycjim


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MAS Airlines flight MH370 dropped to an altitude of 5,000 feet, or possibly lower, to defeat commercial (secondary) radar coverage after it turned back from its Kuala Lumpur-Beijing route on March 8.
Law & Politics

Investigators are poring over the Boeing 777-200ER's flight profile to
determine if it had flown low and used "terrain masking" during most
of the eight hours it was missing from the radar coverage of possibly
at least three countries.

Top officials, who make up the technical team that had been holed up
from morning till late at night here, are looking at the possibility
that the jetliner, carrying 239 people, had taken advantage of the
busy airways over the Bay of Bengal. By sticking to commercial routes,
the flight may not have raised the suspicion of those manning primary
(military) radars of the nations it overflew. To them, MH370 would
appear to be just another commercial aircraft on its way to its

"The person who had control over the aircraft has a solid knowledge of
avionics and navigation, and left a clean track. It passed low over
Kelantan, that was true," said officials.

"It's possible that the aircraft had hugged the terrain in some areas,
that are mountainous to avoid radar detection."

This technique is called terrain masking and is used by military
pilots to fly to their targets stealthily, using the topography to
mask their approach from prying microwaves. This type of flying is
considered very dangerous, especially in low-light conditions and
spatial disorientation, and airsickness could easily set in. The
stresses and loads it puts on the airframe, especially an airliner of
the 777's size, are tremendous.

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Currency Markets at a Glance WSJ
World Currencies

Euro 1.3902
Dollar Index 79.47
Japan Yen 101.50
Swiss Franc 0.8735
Pound 1.6640
Aussie 0.9057
India Rupee 61.11
South Korea Won 1067.75
Brazil Real 2.3563
Egypt Pound 6.9518
South Africa Rand 10.6895

Dollar Index 3 Month Chart INO 79.47

Euro versus the Dollar 3 Month Chart 1.3902


Dollar Yen 3 Month Chart INO 101.50

Treasuries held by foreign central banks dropped by $104 billion to
$2.86 trillion in the week ending March 12, according to Fed data
released yesterday


"The timing of the drop in custody holdings makes Russia a more likely
suspect," said Marc Chandler, global head of currency strategy in New
York at Brown Brothers Harriman & Co. in a telephone interview. "If
Russia did it, then they may have transferred the holdings to another
bank outside of the U.S."

Treasuries held by foreign central banks dropped by $104 billion to
$2.86 trillion in the week ending March 12, according to Fed data
released yesterday, as the turmoil in Ukraine intensified. As of
December, Russia held $138.6 billion of Treasuries, making it the
ninth largest country holder. Russia's holdings are about 1 percent of
the $12.3 trillion in marketable Treasuries outstanding, according to
data compiled by Bloomberg.

"The timing of the drop in custody holdings makes Russia a more likely
suspect," said Marc Chandler, global head of currency strategy in New
York at Brown Brothers Harriman & Co. in a telephone interview. "If
Russia did it, then they may have transferred the holdings to another
bank outside of the U.S."

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A 132-unit luxury project for auto enthusiasts called the Porsche Design Tower.
International Trade

Condos at the 60-story building, featuring an elevator that transports
cars directly into the homes, range from $4.5 million to $32.5 million
for a 17,000-square-foot (1,600-square-meter) four-floor penthouse.

With the oceanfront tower's foundation not yet in place, 113 of its
132 units had sold as of earlier this week. All buyers placed deposits
of 30 percent in cash -- seed money Dezer relied on to gauge interest
in the project on Sunny Isles Beach.

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London Home Prices Rise to Record Amid Focus on Stimulus
International Trade

Asking prices for homes in London surged to a record this month, as
the buoyant outlook spread to other parts of the country, according to
Rightmove Plc.

Prices climbed 2.1 percent from February to 552,530 pounds ($917,000),
taking the annual appreciation to more than 11 percent, the website
operator said today.

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Commodity Markets at a Glance WSJ

Gold futures in New York climbed 3 percent last week to $1,379 an
ounce, and wheat jumped 5.1 percent in Chicago.

Gold 3 Month Chart INO 1382.775 +15% 2014

Crude Oil 3 Month Chart INO 98.61

Copper has dropped 13 percent this year to the lowest levels since 2010.

The metal, which last traded below $5,000 a ton in July 2009, was down
1.4 percent to $6,415 as of 12:36 p.m. on the London Metals Exchange.

"When it starts getting to $5,000 and below," that would threaten
mines in Zambia, Yaluma told reporters on the sidelines of a mining
conference in Lusaka, the southern African nation's capital. "I don't
think this is going to carry on; it will still bounce back."

The slump in the price of copper, which accounts for about 70 percent
of Zambia's export earnings, has seen the kwacha weaken 8.3 percent
this year, the worst performer among the African currencies tracked by
Bloomberg. Yaluma expects Zambia to regain its position as Africa's
top producer of the metal, which it lost last year to the Democratic
Republic of Congo, when new mining projects start production.

Copper May 2014 3 Month Chart INO

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The cost of insuring against default on Russian bonds in the next five years, as measured by credit default swaps, has risen to 278 basis points, or 2.78 per cent of the value of bonds insured, up from 165 bp on January 1 according to Bloomberg
Emerging Markets

The Micex Index (INDEXCF) fell 7.6 percent in Moscow last week,
extending its rout this month to 14 percent.


The Micex gauge has slumped 21 percent from a January 2013 high.

The Moscow Exchange said daily trading volumes in equities rose to a
record-high 72 billion rubles ($2 billion) in the first two weeks of
March, compared with an average of 35 billion for 2013, data compiled
by the exchange show.

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Micex Composite Index via @FT [I think its a BUY]
Emerging Markets

Russian equities have the cheapest valuations among 21 developing
countries monitored by Bloomberg, with shares on the Micex trading at
4.5 times projected 12-month earnings, compared with a multiple of 10
for the MSCI Emerging Markets Index.

read more

Russia Ruble 3 Month Chart INO 36.6545
Emerging Markets

Dubai Rolls Over $20 Billion at Below National Inflation Rate

Dubai, the emirate that had debt maturing this year equivalent to a
third of its economy, refinanced $20 billion at a quarter of the
original cost, freeing cash to service liabilities and fund expansion

The sheikhdom rolled over $10 billion of bonds owed to the central
bank and a loan of the same amount due to Abu Dhabi's government, and
will pay a fixed interest of 1 percent on both, according to a
statement on state-run WAM news agency yesterday. The rate is less
than the United Arab Emirates' 1.1 percent inflation for 2013, and
half the inflation rate forecast for this year. The new debts are
renewable after five years.

Dubai and its state-owned companies borrowed more than $110 billion
developing the real-estate industry and transforming the sheikhdom
into a tourism and financial-services hub. The emirate, which
announced plans to spend $8 billion gearing up to host the World Expo
in 2020, faced $30 billion of maturities in 2014, according to
International Monetary Fund estimates before yesterday's deal.

"Now that they have refinanced a chunk of what's due this year, the
remainder suddenly looks much more manageable," Khatija Haque,
Emirates NBD PJSC's Dubai-based head of research for the Middle East
and North Africa, said in a telephone interview yesterday. "The
interest rate is lower than we anticipated."


We should now see a further acceleration.

Skyscrapers and buildings stand in the business bay development
area in Dubai.

#Dubai from the Sky 23 days ago

Frontier Markets

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Major European and Saudi banks have stopped dealings with Sudan, further straining indebted and cash-starved economy.

Major European and Saudi banks have stopped dealing with Sudan,
diplomatic and other sources say, adding to the sanctions-hit
country's isolation and further straining its indebted, cash-starved

While Khartoum blames increased "pressure" from a US trade embargo
first imposed 17 years ago, a US official said there had been no
change in policy from Washington, according to the AFP news agency.

The move by the European banks appears to reflect an increasingly
cautious attitude by financial institutions which do not want to risk
being found in violation of US sanctions, a Western diplomat said.

Most of the accounts or money going out of Sudan, it's completely frozen.

Local banker, Khartoum.

"I think this is something actually mushrooming," he said of the risk aversion.

Germany's Commerzbank was the latest to sever its Sudan connection,
according to diplomats.

The bank had no comment when reached by AFP.

In 2012, the British banks HSBC and Standard Chartered were fined
$1.92bn and $667m respectively for violations that included sanction
breaches with Iran and Sudan.

That same year, Dutch bank ING agreed to pay $619m to settle US
government accusations that it conducted banned transactions involving
Sudan and other countries.

The European Union itself has no embargo against Sudan, whose
government seized power 25 years ago in a coup.

But European banks with US branches or business "are closing any
Sudanese accounts and won't even process payments from Sudan", the
diplomat said.

This affects private and government transactions.

A local banker, who asked not to be identified, said that starting
this month Saudi banks too had stopped dealing with the African

World Bank set to fund Congo dam


KINSHASA -- The World Bank is likely to approve $73m next week to fund
an expansion of the Inga hydroelectric dam in the Democratic Republic
of Congo, a bank official said over the weekend.

The decision will be a relief to investors, particularly mining firms,
which have been threatened with electricity rationing due to a lack of
power generation, but environmentalists say the effect of the project
has not been properly evaluated.

Projections indicate that once completed, Inga would generate 4,500MW
of electricity. South Africa is expected to be among the hydroelectric
dam's major beneficiaries.

The World Bank, the African Development Bank, the European Investment
Bank, JFPI Corporation, bilateral donors, and the southern African
power companies have all expressed interest in pursuing the project
which is estimated to cost about $80bn.

Inga Dam DRC


South Africa All Share Bloomberg +1.00% 2014


GE Said to Lead Bid for Part of $3.2 Billion S. Africa Rail Plan


South Africa's state-owned Transnet SOC Ltd. will next week announce
General Electric Co. (GE) as the preferred bidder to supply it with
465 rail diesel locomotives as part of a $3.2 billion program, two
people familiar with the decision say.

The Johannesburg-based company and the Department of Public
Enterprises, which oversees Transnet, yesterday said they will
announce "one of the biggest infrastructure transactions in South
Africa" on March 17. They will also announce the preferred bidder to
supply 599 electric locomotives, the people said, who asked not be
identified because the decision hasn't been made public.

Transnet plans to spend about 35 billion rand ($3.2 billion) to buy
the 1,064 locomotives over seven years, Minister of Public Enterprises
Malusi Gigaba said in October 2012. The railway, ports and pipeline
operator is spending 307 billion rand over the period as it seeks to
improve export capacity to boost growth in Africa's largest economy.

Dollar versus Rand 3 Month Chart INO 10.69375


Egypt Pound versus The Dollar 3 Month Chart INO 6.9534


Egypt EGX30 Bloomberg +19.88% 2014



Nigeria All Share Bloomberg -7.33% 2014


Ghana Stock Exchange Composite Index Bloomberg +12.03% 2014


Zambia's dollar security due in September 2012 lost 9.7% in the past
12 months, compared with a 17% return in African sovereign bonds,
according to JPMorgan Chase.


Zambia's fiscal shortfall last year was wider than a 4.3% gap
initially forecast by the Finance Ministry when it set budget targets
in October 2012. A deficit of 6.6% is projected for this year.

The landlocked nation bordering eight countries said in October it may
issue $1bn of Eurobonds, hiring Deutsche Bank and Barclays in January
to lead the sale. Felix Nkulukusa, permanent secretary at the Finance
Ministry, declined to comment on the plans.

Yields on Zambia's $750m of debt sold in September 2012, which began
trading at 5.16%, climbed to 7.97% by 11.52am in Lusaka. The Finance
Ministry may have to pay 7.5% to 8.2%, depending on the amount, said
Irmgard Erasmus, a fixed-income analyst with NKC Independent
Economists in Paarl.

Zambia depends on copper for about 70% of export earnings. Concern
that growth is slowing in China weighed on the price of the metal,
used in plumbing and electrical wiring. Copper for delivery in three
months fell 17% over the past year to $6,505/tonne in London on

Copper's decline was among factors cited by the Bank of Zambia on
March 7, when it said "panic" had gripped the country's
foreign-currency market. The kwacha weakened 1.3% to 6.01 per dollar,
bringing this year's drop to 7.7%. It's the worst among 24 African
currencies this year tracked by Bloomberg. The central bank raised its
benchmark rate by 50 basis points to a record 10.25% on February 28.

read more

The yield dropped to 8.946 percent at this week's auction from 9.011 percent previously, amid massive demand for the securities.
Kenyan Economy

"The rates are heading south," said a fixed-income trader with a
commercial bank. "Government is not under pressure as they are ahead
of their borrowing programme for this financial year."

This eurobond issue will release the pressure cooker that is the
domestic bond and interest rate markets--we should see a good rally in
interest rates January 20 2014


And of course, there is our big Wembley stadium moment with the
eurobond, which is now imminent. I incline to the view that the Kenya
government should slot the Eurobond market the full $2bn. This
eurobond issue will release the pressure cooker that is the domestic
bond and interest rate markets--we should see a good rally in interest
rates. Hopefully, the banks will go for some volume and not just
spread and the economy can get juiced a little on lower interest

Kenya Shilling versus The Dollar Live ForexPros


Nairobi All Share Bloomberg +5.56% 2014


announcements from Co-op Bank on Wednesday 19 March and potentially
StanChart Bank and National Bank which are yet to indicate their
announcement dates. Co-op Bank, StanChart Bank and National Bank
gained 1.6%, 2.0% and 4.3% the previous week.

Nairobi ^NSE20 Bloomberg


4,983.83 +23.18 +0.47%

Every Listed Share can be interrogated here


read more

N.S.E Today

The NSE 20 Share Index retreated 61.18 points to close at 4922.65.
The All Share Index (NASI) shed 0.63 points to stand at 142.94. The
All Share remains +4.603% in 2014. The All Share could not hurdle a
6.62% retreat in Equity Bank's share price today.
East African Portland Cement set a Fresh 52 week High and is +33.33% in 2014.
The Equity Market awaits Earnings Releases from COOP Bank. Standard
Chartered Bank and National Bank this week.

N.S.E Equities - Commercial & Services

Safaricom firmed 0.414% to close at 12.10 and was trading at session
Highs of 12.30 +2.07% at the Finale. Safaricom traded 6.354m shares
and for every Seller, There were 2 Buyers at the Finish. Safaricom is
+11.52% in 2014 and will retest its Life Time Closing High of 12.45
before the End of the Month.

N.S.E Equities - Finance & Investment

Equity Bank was the most actively traded share at the Securities
Exchange and retreated sharply and 6.62% to close at 31.75. Equity
Bank traded a 31.00-33.00 range and 2.873m shares worth 91.742m.
Equity Bank reported an +11.025% acceleration in Full Year 2013 Profit
before Tax and trades on a PE of 8.884. Equity Bank is +3.25% in 2014.
Kenya Commercial traded 2nd at the Exchange and closed unchanged at
46.00 and traded 1.806m shares worth 83.488m. Kenya Commercial Bank
had a close to 5 versus 1 Buy Side versus Sell Side Imbalance and that
is supportive for the Price. KCB accelerated FY 2013 PBT +16.94% and
trades on a PE Ratio of 9.544. KCB is -2.64% in 2014 and 8% below an
All Time closing of 50.00 set on a number of occasions in 2012.
COOP Bank closed unchanged at 19.00 and traded 1.696m shares worth
32.262m. COOP Bank will release Full Year Earnings this week. COOP
Bank rallied 1.6% last week in anticipation of the Earnings Release.

Jubilee Insurance was the biggest Gainer at the Exchange and traded
1,400 shares all at 320.00 +5.26%. Jubilee is +14.285% in 2014 and
trades on a Trailing PE of 9.06 and looks cheap on that basis versus
its Peers.
CIC Insurance firmed +1.34% to close at 7.55 and traded 1.587m shares.
CIC Insurance has rallied +16.15% since releasing its FY Earnings and
is +26.89% in 2014. CIC trades on a PE multiple of 11.2686.

Centum firmed 0.67% to close at 37.50 and was trading at 38.00 +2.01%
at the Closing Bell. Centum traded 99,000 shares. Centum is +13.63% in
2014 and that follows on from a blistering triple digit percentage
Gain in 2013.

N.S.E Equities - Industrial & Allied

KenolKobil eased 0.52% to close at 9.60 but was trading higher and at
9.70 +0.52% at the Finish. KenolKobil traded 2.687m shares worth
25.807m. KenolKobil reported an H1 PBT of 199.086m versus a loss of
5.683516b in the previous Year's Equivalent reporting Period. if there
has been some Follow through or the Trajectory has been maintained
through the Full Year, the price has headroom.

EABL eased 0.3846% to close at 259.00 and traded 58,700 shares. EABL
is +18.264% above its 52 week closing Low from the 19th of last month
and I expect a Resumption of the rebound towards 275.00/290.00.

East African Portland Cement firmed +2.22% to close at 92.00 and set a
Fresh 52 week closing High. Portland traded 1,300 shares and has now
rallied +33.33% in 2014 in a Move that has gained momentum which will
probably carry the Price over the 100.00 Line.

by Aly Khan Satchu (www.rich.co.ke)
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March 2014

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