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Satchu's Rich Wrap-Up
Thursday 02nd of March 2017

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Normal Board - The Whole shebang
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The Latest Daily PodCast can be found here on the Front Page of the site

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U.S. hits new highs: Markets Wrap @adhaigh @markets

Dow needs just 5 weeks for latest 1,000-point surge. Has gained 16%
since Trump election.

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An obscure climate phenomenon in the Indian Ocean The Indian Ocean Dipole

An obscure climate phenomenon in the Indian Ocean is contributing to
an East Africa drought that is threatening the lives of millions of
people, as famine looms.

It wasn’t until the 1990s that Japanese scientists discovered the
Indian Ocean Dipole, a warm pool of water that migrates between
western and eastern “poles” and affects atmospheric temperatures and
rainfall. The phenomenon occurs in cycles of positive (warmer) and
negative (cooler) sea temperatures, but it has become more extreme in
recent years due to climate change.

A negative Indian Ocean Dipole results in less rainfall over East
Africa, and that’s contributing to the current drought that aid
agencies warn could trigger mass famine.

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European Commission just published its White Paper on the Future of Europe
Law & Politics

Reflections and scenarios for the EU27 by 2025

On 25 March 2017, 27 leaders of the European Union’s Member States
will stand united in peace and friendship in Rome. That alone is an
achievement that many would have thought unthinkable when the six
founding Member States agreed on the Treaties of Rome 60 years ago.As
we mark this anniversary, our thoughts are with those before us whose
dream for Europe has become a reality. Now is the time to reflect with
pride on our achievements and to remind ourselves of the values that
bind us together.

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Sessions Spoke With Russian Envoy During Trump's 2016 Campaign
Law & Politics

U.S. Attorney General Jeff Sessions had conversations with Russia’s
ambassador to the U.S. while he was a prominent surrogate for
President Donald Trump’s election campaign, even though he said during
his confirmation hearing that no contacts had occurred, the Justice
Department confirmed late Wednesday.

Justice Department spokeswoman Sarah Isgur Flores portrayed the
contacts that Sessions had with Ambassador Sergey Kislyak as part of
his work as a senator rather than a surrogate for Trump’s campaign.

“Last year, the senator had over 25 conversations with foreign
ambassadors as a senior member of the Armed Services Committee,
including the British, Korean, Japanese, Polish, Indian, Chinese,
Canadian, Australian, German and Russian ambassadors,” she said. “He
was asked during the hearing about communications between Russia and
the Trump campaign--not about meetings he took as a senator and a
member of the Armed Services Committee.”

The revelation, reported earlier by the Washington Post, has raised
fresh questions about which Trump associates had contacts with Russian
government officials during the presidential campaign and what was
discussed. It’s likely to intensify demands that Sessions recuse
himself from investigations into Russian hacking in last year’s


What is clear is that Sessions and Flynn were having these
conversations with the knowledge of the Principal.

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Al-Qaeda Gets An Oscar
Law & Politics

Hollywood is all about fake. That is what movies are – fake depictions
of a fake reality that only exist in the mind of scriptwriters,
directors and a usually gullible audience. (Disclosure: I do like some

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Currency Markets at a Glance WSJ
World Currencies

Euro 1.0531
Dollar Index 101.91
Japan Yen 114.08
Swiss Franc 1.0104
Pound 1.2284
Aussie 0.7660
India Rupee 66.74
South Korea Won 1141.60
Brazil Real 3.0910
Egypt Pound 16.0517
South Africa Rand 13.0458

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Chocolate Prices to Fall as Cocoa Surplus Seen at Six-Year High

Chocolate prices are set to fall as the world cocoa market shifts from
a deficit to the largest surplus in six years, according to the
International Cocoa Organization.

Global production will top demand by 264,000 metric tons in the
2016-17 season, which started Oct. 1, the London-based group said
Tuesday in a report. The deficit was 196,000 tons in the preceding

World output is seen rising almost 15 percent to 4.55 million tons in
the current season, with gains in Ivory Coast, the top grower, as well
as in Ghana, Indonesia and Ecuador. In contrast, worldwide grinding of
cocoa beans -- a measure of demand -- will advance 2.9 percent to 4.24
million tons, the group said.

The shift in the supply and demand dynamics of the cocoa market has
weighed on prices in the past 12 months. Cocoa futures have slumped
about 35 percent in New York over the period. If that decline is
sustained in the months ahead, prices for finished cocoa and chocolate
products are expected to drop, thereby supporting consumption, the
group said.

Emerging Markets

Frontier Markets

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Merkel pushes investment to stem migrant flows FT

Angela Merkel is stepping up diplomatic efforts to stem migrant flows
to Europe as part of what Berlin terms a “Marshall plan for Africa”.

Responding to domestic criticism of her refugee policies as elections
loom, the German chancellor will visit Egypt and Tunisia this week to
press for greater efforts to counter the smuggling of migrants across
the Mediterranean.

Ms Merkel wants more co-operation in accepting the return of failed
asylum seekers from the EU and will broach the idea of establishing
EU-backed camps in north Africa for migrants rescued at sea or while
asylum applications are processed.

But the chancellor is also taking a business delegation, underlining
Berlin’s desire to curb migration pressures by fostering economic
development. “Only when there is overall development can the pressure
for flight and for expulsions be overcome,” Ms Merkel told the Munich
Security Conference last month.

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Fastest-Growing African Economy Has Banks Lining Up for Entry

Lenders are lining up to establish a presence in Ethiopia, one of
Africa’s fastest-growing and most under-banked economies. Now they
need the government to let them open their doors.

Over the past two years, Standard Bank Group Ltd., Africa’s biggest
lender by assets, and KCB Group Ltd., Kenya’s largest lender, have
joined the likes of Citigroup Inc., Commerzbank AG and Ecobank
Transnational Inc. in setting up representative offices in sub-Saharan
Africa’s second-most populous country.

They’re wagering that the country’s ambitions to join the World Trade
Organization, coupled with increasing demand for capital to support
the economy, will lead the government to open up an industry that’s
been closed to investors since a Marxist junta nationalized banks four
decades ago. Still, they’ll be investing in a country that’s cracked
down on political opponents, with the benefits of faster growth yet to
trickle down to the majority of the population.

“It has the potential to become one of the most exciting banking
markets in the region,” said Robert Besseling, Johannesburg-based
director at Exx Africa, which advises companies on risks and business
risks on the continent. “Government has hinted at liberalization and
even privatization of state-protected sectors.”

The prize is a $62 billion economy of 105 million people that’s grown
quicker than any other in sub-Saharan Africa over the past decade and
may expand 7.5 percent this year, according to International Monetary
Fund data. Only 22 percent of adults in Ethiopia have access to a bank
account, compared with 70 percent in South Africa, the continent’s
most industrialized economy, and a sub-Saharan African average of 34
percent, according to World Bank statistics.

“The closed banking sector could be eventually be opened up for
foreign investment,” said Exx Africa’s Besseling. “Although it might
not be in 2017.”

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@SanlamKenya reports FY 16 EPS 0.63 Earnings here
Kenyan Economy

Par Value:                  5/-
Closing Price:           24.75
Total Shares Issued:          144000000.00
Market Capitalization:        3,564,000,000
EPS:             0.63
PE:               39.28

Year End through 31st December 2016
FY Gross written premium 5.224546b vs. 5.181614b +0.829%
FY Outward reinsurance premium [329.341m] vs. [384.628m] -14.374%
FY Net written premium 4.832205b vs. 4.796986b +0.734%
FY Investment income 2.518645b vs. 2.388531b +5.447%
FY Fair value gains [450.341m] vs. [637.144m] -29.319%
FY Total income 7.154074m vs. 7.237184b -1.148%
FY Gross benefits and claims paid [4.193984b] vs. [3.620249b] +15.848%
FY Reinsurers’ share of claims 204.498m vs. 96.593m +111.711%
FY Net change in contract liabilities [488.981m] vs. [733.559m] -33.341%
FY Net claims and policy holder benefits [4.478467b] vs. [4.257215b] +5.197%
FY Operating and other expenses [1.669594b] vs. [1.466658b] +13.837%
FY Total benefits, claims and other expenses [6.836801b] vs. [7.186122b] -4.861%
FY Profit before tax 317.053m vs. 54.325m +483.623%
FY Profit for the year after tax 70.623m vs. 27.350m +158.219%
FY Comprehensive income attributable to equity holders of the parent
106.061m vs. [61.559m] +272.292%
EPS (Basic & diluted) 0.63 vs. [0.43] +246.512%
Total capital and reserves 3.932244b vs. 3.802047b +3.424%
Total assets 28.442590b vs. 27.109278b +4.918%
Insurance contract liabilities 12.704048b vs. 11.397467b +11.464%
Cash resources at the end of the year 2.497436b vs. 3.916168b -36.228%

Company Commentary

Life Insurance Gross written premium declined by 5% to 4.4b from 4.6b in 2015
retail business was impacted by the expected effects of streamlining
the distribution channels and agency force aimed at improving
productivity going forward
Investment Portfolio earnings increased by 50% to 2.1b in 2016 driven
by good investment returns
General Insurance gross written premium grew by 58%
Income from property sales declined due to a depressed property market
Asset Management Fee income increased by 31%
No Dividend


much better than expected results.

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KenGen reports H1 EPS -18.681% Earnings
Kenyan Economy

Par Value:                  2.50/-
Closing Price:           6.30
Total Shares Issued:          6243873667.00
Market Capitalization:        39,336,404,102
EPS:             1.08
PE:                 5.833

H1 Electricity revenue 14.676b vs. 14.757b -0.549%
H1 Steam revenue 2.465b vs. 2.514b -1.949%
H1 Other income 598m vs. 1.141b -47.590%
H1 Revenue 17.739b vs. 20.025b -11.416%
H1 Operating expenses [4.392b] vs. [4.141b] +6.061%
H1 Steam costs [1.279b] vs. [1.648b] -22.391%
H1 EBITDA 12.068b vs. 14.236b -15.229%
H1 Depreciation & amortisation [4.529b] vs. [4.519b] +0.221%
H1 Finance costs [1.605b] vs. [1.622b] -1.048%
H1 Profit before tax 6.566b vs. 8.384b -21.684%
H1 Profit for the period 4.625b vs. 5.668b -18.402%
H1 EPS (Basic) 2.10 vs. 2.58 -18.605%
H1 EPS (Diluted) 0.74 vs. 0.91 -18.681%
Cash and cash equivalents balance at 31st December 6.545b vs. 2.564b +155.265%
No interim dividend

Company Commentary

Lower revenue from steam and commercial drilling services
Steam Revenue decreased to 2.465m compared to 4,127m in the same
period in the previous year due to transmission constraints in the
despatch of wellhead Units
The Previous year amount included arrears of 1,613m following the
signing of steam resources and maintenance agreement in September 2015
Other Income decreased to 598m from 1,141m attributable to decrease in
revenue from commercial drilling services and insurance compensation.
Carbon credits earned 57m
Results were impacted by decommissioning of Garissa, Lamu and Embakasi
Gas Turbine Thermal power plants and non-receipt of revenue from
commercial drilling services
Performance for the remaining period to 30 June 2017 is expected to
improve following the completion of the evacuation line for the
Wellheads and fixing of machine breakdowns which affected some power
commencement of the construction of 158MW Olkaria V is expected to
take place in Q3 2016/2017 financial year


some operational challenges it seems. its a very cheap share in my opinion.

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"M-Pesa is a critical nerve supporting the money transfer system" @LinusGitahi @BBGAfrica
Kenyan Economy

A study of Kenya’s telecommunications industry proposes breaking up
Safaricom Ltd., the country’s biggest company, according to brokerage
AIB Capital Ltd.

The report compiled by Analysys Mason proposes “a raft of measures
supposed to level the telecommunications playing ground and tame
Safaricom,” AIB Chairman Linus Gitahi said in an opinion article
published Wednesday in the Nairobi-based Daily Nation newspaper. The
measures include splitting the company’s mobile-money business M-Pesa
from the rest of Safaricom, he said.

Safaricom Chief Executive Officer Bob Collymore last week criticized
proposals by a Kenyan lawmaker to split the company as “plain stupid.”
The company, which is is 40 percent owned by Newbury, England-based
Vodafone Plc, declined to comment on Wednesday.

Safaricom is Kenya’s biggest mobile provider with a 69 percent market
share as of the end of September, according to the Communications
Authority of Kenya. Its closest competitor is the national unit of
Bharti Airtel Ltd., with 17.5 percent. The company’s M-Pesa
mobile-banking product is also a significant market leader, processing
about 851 billion shillings ($8.2 billion) of transactions during the
third quarter last year, about 79 percent of the country’s total.

If implemented, the proposals in the report risk “untold consequences”
for Kenya’s financial system, Gitahi said.

“M-Pesa is a critical nerve supporting the money transfer system,” he
said. “Ripping away M-Pesa from Safaricom would leave both in severe

Analysys Mason declined to comment on the report, which is currently a
draft that has “yet to be finalized,” it said in an e-mailed response
to questions. Kenya’s Communications Authority, which regulates the
industry, said on Tuesday it’s reviewing the report before releasing
it to the public.

Safaricom shares have fallen for the past three days to the lowest
level since July, according to data compiled by Bloomberg.


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27-FEB-2017 :: Safaricom made an outsize bet on the information highway and on mobile money.
Kenyan Economy

Safaricom made an outsize bet on the information highway and on mobile
money. ey made those investments (hundreds of millions of dollars) in
good faith. They would never have made those investments if Kenya Inc
had told them then. Look folks, if you do well we are going to barge
in and demand we take control of your infrastructure and open it to
your competitors. Which brings me back to the captioned headline: “It
sends a really worrying message to international investors in
investing in the country...It would imply that this is no longer a
safe place.” And we have reached a point when we have to call a spade
a spade. This is ‘’rogue’’ policymaking; plain and simple, and
inimical to the national interest.

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@Safaricomltd share price data here -10.966% 2017
Kenyan Economy

Par Value: 0.05/-
Closing Price: 17.05
Total Shares Issued: 40065428000.00
Market Capitalization: 683,115,547,400
EPS: 0.95
PE: 17.947

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Kenya Shilling versus The Dollar Live ForexPros 102.75
Kenyan Economy

Nairobi All Share Bloomberg -8.02% 2017


122.65 -2.24 -1.79%

Nairobi ^NSE20 Bloomberg -6.91% 2017


2,966.16 -28.37 -0.95%

Every Listed Share can be interrogated here


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by Aly Khan Satchu (www.rich.co.ke)
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March 2017

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