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Satchu's Rich Wrap-Up
Thursday 31st of March 2022
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A perplexing, ever changing matrix, a Squid Game where asset values have to be maintained to support the majesty of the debt, a meta verse paid for by the serfdom of the ordinary Joe. @hendry_hugh
World Of Finance

A perplexing, ever changing matrix, a Squid Game where asset values have to be maintained to support the majesty of the debt, a meta verse paid for by the serfdom of the ordinary Joe. Where are the opiates that will keep the many in their chains? Why do the stakes keep rising?

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Derivatives, Alvin said. I don’t speculate about the future, I trade it. @NewYorker
World Of Finance

And they were cross‑linked and interwoven and resold in large bundles, “future on future,” Alvin said, handing me a paper towel.
“Forget about the forces of the free market, my friend. Commodity prices no longer refer to any value, past or present—they’re just ghosts from the future.”

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29-NOV-2021 :: Regime Change
World Of Finance


There is no training – classroom or otherwise.. that can prepare for trading the last third of a move, whether it's the end of a bull market or the end of a bear market. 
There's typically no logic to it; irrationality reigns supreme, and no class can teach what to do during that brief, volatile reign. Paul Tudor-Jones

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Its a Wizard of Oz moment
World Of Finance

We have reached the point when the curtain was lifted in the Wizard of Oz and the Wizard revealed to be ‘’an ordinary conman from Omaha who has been using elaborate magic tricks and props to make himself seem “great and powerful”’’ 

The Curtain has been lifted and Mr. Powell has now arrived at his Volcker moment 

Deutsche Bank's Jim Reid notes that yesterday's surge in the 2-year US Treasury yield was, by one measure, "the biggest "shock" since October 1979 when Volcker announced his intentions on the world @ReutersJamie
The last time inflation was here, February 1982 - the Fed Funds Rate was 15%. @Convertbond
Dartmouth economist and former Fed adviser Andrew Levin says the Fed needs to get rates to a neutral setting within a year or so, and that the means getting the Fed Funds rates up to 4% or 5%

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#Zoltan Night time sneak attack. via @TheBondFreak
Law & Politics

We are witnessing the birth of Bretton Woods III – a new world (monetary) order centered around commodity-based currencies in the East that will likely weaken the Eurodollar system and also contribute to inflationary forces in the West.
A crisis is unfolding. A crisis of commodities. Commodities are collateral, and collateral is money, and this crisis is about the rising allure of outside money over inside money. 

The beautiful paradox of linear rates (the stuff you trade and I write about) is that you need to think linear to find relative value most of the time, but you have to think non-linear to recognize and survive regime shifts

We are seeing a regime shift unfold in funding markets currently (which, as always, will pass), and a sea change in inflation dynamics and FX reserve management practices.

Do you see inflation in the West written all over this like I do?
This crisis is not like anything we have seen since President Nixon took the U.S. dollar off gold in 1971 – the end of the era of commodity-based money.
When this crisis (and war) is over, the U.S. dollar should be much weaker and, on the flipside, the renminbi much stronger, backed by a basket of commodities.
From the Bretton Woods era backed by gold bullion, to Bretton Woods II backed by inside money (Treasuries with un-hedgeable confiscation risks), to Bretton Woods III backed by outside money (gold bullion and other commodities).
After this war is over, “money” will never be the same again... ...and Bitcoin (if it still exists then) will probably benefit from all this.

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The @POTUS Official Who Pierced Putin’s “Sanction-Proof” Economy @NewYorker
Law & Politics

Singh said, “We’ve made him stare into an economic abyss. But he could choose to pull back.”

The markets are where these two systems touch—the supply of buckwheat, the joint energy ventures, the price of the ruble—and within this arena the sanctions were a demonstration that Washington still had levers to pull. “You know, we can play chess, too,” Singh said. “It was important for us to show that the fortress could come crumbling down.”

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Weaponizing finance in familiarly old ways may prove as disastrous as 1919's reparations against Germany, says @KarenPetrou via @bopinion
World Of Finance

After World War I, the great powers decided on reparations to punish an aggressor for its carnage.

 After World War II, the great powers turned instead to reconciliation, creating the Bretton Woods Agreement to entice aggressors into good statecraft to gain access to a rules-based global financial order. 

Now, the great powers are reasserting themselves with a new kind of reparations: sanctions and even expropriations. 

We shall see if aggressors are dissuaded from still worse, but the post-1945 global-financial-policy construct is doomed. 

Given the vital importance of stable finance, it’s not too soon to think about what must come next to prevent 2022’s reparations from ending as disastrously as a century ago.  
In 1919, the U.S. was forced to abandon much of the global decision-making consensus it sought as other powers balked. 

In 1945, the catastrophe partly caused by 1919’s reparations against Germany led the Allies, then including the Soviet Union, to craft a consensus-based, global financial order resting on a neutral reserve asset — gold — that all believed would ensure the balance of power stayed balanced. 

After 1971, the U.S. abandoned the gold standard and gained increasing clout as the dollar replaced gold as the world’s go-to reserve currency. 

The result was a long-lasting, if often uneasy, financial order empowering the increasingly globalized, financialized system that has come to advantage the U.S. at the growing cost of wealth inequality.
Competing powers and growing inequality were already cleaving the global financial order before Russia’s invasion of Ukraine put an end to any hope of orderly consensus among conflicting nations. 

The conflict is simply too threatening to maintain the status quo, forcing both the U.S. and other major economic powers to redefine global finance to suit their own geopolitical objectives. 

So far, the crisis has reinforced the dollar and thus the U.S. via a sharp reminder that no other currency can credibly promise what the greenback already offers: convertibility, political stability and liquidity thanks to sovereign bonds backed by an unquestioned commitment to open markets. 

The current global financial order largely set by the U.S. has done irreparable damage to Russia and its overt allies, including China.

The order goes on to make clear that the U.S. will cooperate in global efforts to redefine money and the payment system, but only if they preserve “core democratic values.” 

If these objectives are pursued with the naked “America First” rhetoric of the Trump administration, then global finance will surely advance U.S. objectives at this moment of maximum advantage just as the Versailles Treaty forced Germany to pay up. 

However, weaponizing finance in a new, but familiarly old way may prove as disastrous as 1919’s reparations. 

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Currency Markets at a Glance WSJ
World Currencies

Euro 1.115710
Dollar Index 97.878
Japan Yen 121.8255
Swiss Franc 0.92402
Pound 1.313045
Aussie 0.747855 
India Rupee 75.7998 
South Korea Won 1212.015 
Brazil Real 4.7710000 
Egypt Pound 18.246300
South Africa Rand 14.50300

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Crouching Tiger, Hidden Problems @doomberg
World Of Finance

“A value is valuable when the value of value is valuable to oneself.” – Dayananda Saraswati

What is something worth? For many, this is a simple question with an easy answer: whatever somebody is willing to pay for it. 

In practice, valuation is critically important to the core functioning of finance over the long run. How value is determined – and who gets to do the determining – can make the difference between fortunes won and lost

As with all such circumstances, if there is big money on the line, there will be people with the means, opportunity, and motive to stretch the boundaries and grab more than their fair share of it.

In the public stock markets, valuation seems straightforward. Stocks trade hands between willing buyers and sellers during market hours, and when the markets close there’s a final trading price for the day. 

But things aren’t always so transparent. Imagine you are a money manager with a large position in XYZ stock. 

It is somewhat illiquid in that it doesn’t trade in big volumes. Since your compensation depends in part on the closing value of XYZ on December 31st, you decide to make a series of small buys in the last few minutes into the close, artificially pushing the value of XYZ up by 5%. 

Your entire stake now gets marked there, but it isn’t real - you have merely “painted the tape.” 

This brilliant meme from @Keubiko captures the essence of the issue well:

Now, there are rules against such manipulations in the public markets, but what if XYZ Company is a privately-held startup?

If a founder sells 15% of her startup to an accredited investor in exchange for an injection of $150,000, then it might be fair to say her company is worth $1 million. 

What if it is the founder’s parents making the investment? A best friend? A business partner in a different but related venture? 

Throw into the mix critical deal terms like distribution preferences, board seats, voting rights, anti-dilution protections, and other negotiated concessions, and it quickly becomes apparent how difficult the concept of private value can become – and how easily it can be manipulated.

Things get really interesting when the public and private company worlds collideand no person has pushed the envelope harder at this interface than Masayoshi (Masa) Son, Chief Executive Officer of SoftBank

SoftBank is a large Japanese conglomerate consisting of run-of-the-mill operating companies and a staggering array of aggressive private investments deployed through all manner of complex structures, often with significant leverage. 

Known as a swashbuckling gambler with an incredible tolerance for volatility, Masa Son is famous for his bizarre investor presentations during which he rails against the value the public markets assign to the whole of SoftBank, especially compared to what he believes is its proper sum-of-the-parts valuation. 

Below is a famous moment from his 2020 presentation, delivered at the height of the Covid-19 pandemic, during which Masa Son claimed SoftBank’s equity was worth 25 trillion Yen, yet the market was assigning it only 9 trillion Yen (on the slide, he’s backing out the 4 trillion Yen in SoftBank debt).

Perhaps the absurd story of the Masa-backed Indian startup OYO Rooms (OYO) might explain some of the market’s skepticism.

We’ve long been fascinated with OYO and its young founder, Ritesh Agarwal. You can think of OYO as the WeWork of budget hotel rooms in Southeast Asia. 

The business model involves signing participating hotel chains onto their app, promising them a fixed revenue stream, paying to upgrade their rooms to a common OYO standard, and managing the risk of filling those rooms with satisfied customers. 

We’ve never understood how this enterprise was going to sustainably make money, but with SoftBank the force behind WeWork, it’s not surprising that Masa Son was seduced by Agarwal’s concept as well.

In July of 2019, we were treated to a fascinating set of headlines about an OYO transaction that – to put it mildly – seemed to bury the lede. 

Here’s how things were initially described by CrunchBase (emphasis added throughout):

“The fast-growing Indian hospitality business Oyo has garnered a valuation of $10 billion after its founder, Ritesh Agarwal, purchased $2 billion in shares from venture capital firms Sequoia Capital and Lightspeed Venture Partners, the company announced Friday.
Agarwal, 25, founded Oyo in 2013 at the age of 19. Following immense growth of the now global hotel chain business, 

Agarwal opted to increase his 10% stake to 30% via a Cayman Islands company called RA Hospitality Holdings, according to The Wall Street Journal. 

SoftBank has also increased its percent ownership as part of this round, now owning nearly half of the company.”

To the casual observer, this would seem like an incredibly bullish development. The company is now worth $10 billion! 

The OYO CEO was so confident in his company’s prospects that he personally bought $2 billion worth of stock! What’s not to like? 

This mark made OYO among the most valuable investments in SoftBank’s portfolio at that time. 

When we first read this announcement, we wondered why the bluest of blue-chip VC firms, Sequoia and Lightspeed, were bailing on a huge chunk of their investment in such a hot startup, and how a founder in his early 20s without a major exit under his belt could get his hands on $2 billion in cash? 

As it turns out, Agarwal borrowed the money, leveraging a personal guarantee from Masa Son himself to buy the shares at the new, elevated valuation:

“In a highly unusual move, Agarwal, now 26, borrowed $2 billion to buy shares in his own company as the valuation rose, and Son personally guaranteed the loans from financial institutions, including Mizuho Financial Group Inc.”

Highly unusual, indeed.

According to (paywalled) data from CrunchBase, SoftBank led OYO’s $100 million Series B round in July 2015 and its $90 million Series C round in August 2016. 

SoftBank Vision Fund then led OYO’s $250 million Series D round in September 2017 and its $650 million Series E round in September 2018. 

Presumably, all these injections funded cash-burning growth and came at progressively higher valuations.

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Crouching Tiger, Hidden Problems @doomberg [continued]
World Of Finance

With the July 2019 transaction, the CEO of SoftBank painted the tape by effectively lending money to the CEO of a startup that he and his affiliated entities had already gone all-in on. 

The headline became the higher valuation. How Agarwal funded his increased stake and the fact that Sequoia and Lightspeed had liquidated much of their OYO stock became afterthoughts. 

SoftBank promptly marked its various investments in OYO at the new $10 billion “valuation,” which is no minor thing since Masa Son is known to pledge substantial portions of his personal holdings in SoftBank stock for loans to fund his lifestyle and other investments.

In this seemingly endless loop of conflicting motivations and circular finance, was OYO really worth $10 billion in July of 2019? Does 25 – 4 = 9? make more sense now?  

Nearly three years later, presumably with the depths of the Covid-19 crisis behind it, OYO is still a serious cash burner and seems to be struggling to generate enthusiasm for its planned initial public offering (IPO). Here’s how Bloomberg recently described the situation:
“Oyo, the high-profile affordable lodging startup that filed for an initial public offering last year, is considering slashing its fundraising target by half or even shelving the debut, according to people familiar with the matter.

Faced with headwinds including slumping stock markets, Oyo-operator Oravel Stays Ltd. could clip its Indian IPO from the nearly $1 billion initially sought to half that, the people said, declining to be identified discussing internal matters. 

It’s considering also halving its expected valuation from the $12 billion originally targeted, they said. Oyo could even decide to suspend its IPO plans, the people said.”

By our math, half of 12 is 6, which is decidedly less than 10, and we suspect this IPO will get shelved lest a new and unfavorable “valuation” force SoftBank to write down its investments. 

With Chinese internet stocks crashing and US growth stocks swooning under the pressure of increased interest rates, SoftBank’s solvency itself is slowly moving into focus. 

The cost to insure against a SoftBank default has been creeping higher in the past several months, recently reaching levels not seen since March of 2020.

The entertainment value of Masa Son’s antics aside, we flag these events because of their potentially systemic nature, and as a warning for what the consequences might be if he is ever forced to play this game in reverse. 

As anyone with experience in the VC sector can attest, Masa Son threw around so much money to so many startups at such eye-watering valuations that most other VC firms were forced to follow suit, creating a self-reinforcing pattern of ever-higher valuation comparisons as the basis for the pricing of the next hot deal. 

We suspect the bubble in the private sector is even bigger than the one transpiring in the public markets.

We conclude with some thoughts on how a potential collapse in private valuations might put downward pressure on the public markets. 

Several large and well-known hedge funds have seen the allure of alpha in the private markets and have invested accordingly. 

Such crossover funds hold a mix of both private and public securities, selling allocators on the idea that excess returns can be achieved with manageable incremental risk. 

Mega funds Coatue Management and Tiger Global Management have been particularly active in this way, and both have been in the news recently. Here’s an interesting story on Coatue that caught our eye last week:

“Coatue Management investors are pulling $250 million from the firm’s main hedge fund. But they won’t get all the money they’re asking for. Assets invested in private companies will be withheld by Coatue and placed in a side-pocket, according to people familiar with the matter. That amounts to 13% of the cash being sought by clients -- a total of $33 million.

Coatue’s decision comes as the firm, like many industry peers, has increasingly invested in private companies, hoping to see outsized gains when these enterprises go public. 

About 11% of Coatue’s main hedge fund, which ran $15 billion as of year-end, is comprised of private firms. But as market volatility increases asset managers may be forced to mark down the value of their non-public stakes.”

Dealing with redemptions is always challenging, and the danger of holding a mix of liquid and illiquid securities only exacerbates the problem. 

When cash needs to be produced in short order, one tends to discover just how much truth is in the price being carried on the books.

For its part, Tiger Global Management has been investing in private companies at a staggering pace, making it the most prolific VC investor in the world last year. Here’s how the Wall Street Journal reported on it last week:

“As an investor, Tiger Global surpassed all other venture firms last year, backing 335 deals, a more than fourfold increase from the 79 transactions it did in 2020, according to data provider CB Insights. The firm picked up the pace as this year began, doing two deals each business day into mid-February, the data show.”

We’ve heard the whispers from our friends in the VC sector about the crazy valuations Tiger is paying to close these deals, and one wonders just how much due diligence can be going on when you are doing two deals a day. 

Perhaps it is just a coincidence that Bloomberg recently reported on Tiger’s rough start to 2022:

Chase Coleman’s Tiger Global Management posted a 10% decline for its flagship hedge fund last month, a significantly steeper drop than the broader market, according to people familiar with the matter. That follows a 14.8% swoon in January, extending its loss for the year to 23%.”

Most financial crises find their genesis in obscure parts of the markets that fly under the radar until it is too late to stop the contagion. Will the bubble in private market valuations be the catalyst for the next major downturn? We’ll be watching this space closely.

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19-JUL-2021 :: Mirrors On The Ceiling The Pink champagne on ice
World Of Finance

Mirrors on the ceiling,
The pink champagne on ice
And she said "We are all just prisoners here, of our own device" And in the master's chambers,
They gathered for the feast
They stab it with their steely knives,
But they just can't kill the beast
Last thing I remember, I was
Running for the door
I had to find the passage back
To the place I was before
"Relax, " said the night man,
"We are programmed to receive. You can check-out any time you like, But you can never leave! "

And when the Feedback Loop kicks in I expect it to kick big to the downside.

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09-MAY-2021 :: The Lotos-eaters
World Of Finance

"Courage!" he said, and pointed toward the land, "This mounting wave will roll us shoreward soon."

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08-FEB-2021 :: The Markets Are Wilding
World Of Finance

You have it all wrong The Pink Tulips aren't Trading Tulips, they're investing Tulips @StockCats

The hardest thing at the peak is to be the naysayer the short seller.
Anybody can be decisive during a panic It takes a strong Man to act during a Boom. VS NAIPAUL
“The businessman bought at ten and was happy to get out at twelve; the mathematician saw his ten rise to eighteen, but didn’t sell because he wanted to double his ten to twenty.”

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World Of Finance

Bullish oil beyond the immediate term. Watch them pay more to fill the SPR back up.


This smacks of desperation

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There is mounting scepticism that the Ethiopian government's truce will be a precursor to peace, after 16 months of a brutal civil war @Telegraph @__TomCollins

Rebel officials have warned aid still hasn’t reached Ethiopia’s conflict-ridden Tigray region, where thousands are at risk of starvation, despite the promise of a humanitarian truce last week.
On Thursday, the Ethiopian government unilaterally declared a ceasefire to allow aid trucks to access the country’s northernmost state, raising hopes of an end to a devastating 16-month civil war.
The Tigray People’s Liberation Front (TPLF) initially agreed to a cessation of hostilities, but have since accused the central government of creating “fictitious narratives” to mislead the international community.
“Ethiopian authorities continue to saturate the airwaves with the false claim that humanitarian aid was flowing into Tigray on a daily basis,” it said in a statement on Monday.
The comments come amid mounting scepticism that the truce was a precursor to peace. 
“It's not yet clear that either the federal or Tigray governments are willing to make the necessary concessions to make this peace process work,” said William Davison, a senior analyst for Ethiopia at Crisis Group, a conflict-mitigation organisation. 
“If the federal government lent all its political and military weight to the humanitarian access issue, then it could provide safe passage for the UN's World Food Programme to consistently deliver food aid to Tigray.”
For months, aid agencies have lobbied the government to lift a blockade on the region of around seven million people, where more than 90 per cent of the population require humanitarian assistance. 

The last aid truck to deliver supplies to Tigray was in mid-December, forcing NGOs to deliver food and medical equipment by air.
Delivery drivers report being detained en route and three humanitarian workers from Médecins Sans Frontières were killed in June last year as they attempted to access Tigray.
The United Nations said the region requires 100 trucks a day to prevent further casualties. 

Researchers estimate that up to 200,000 people have already died from starvation.
Early reports over the weekend suggested that humanitarian convoys ready to depart to Tigray from Semera, the capital city of the Afar region, northeastern Ethiopia, have not yet been given the green light by Afar authorities. 
Mr Davison told The Telegraph it’s unclear why officials are blocking aid deliveries when the federal government gave clearance and announced the humanitarian truce.
“The degree to which the Afar actors, at a community level and at the regional level, are operating autonomously and so independently of the federal government is hard to assess,” he said.
But analysts believe it could be linked to a complicated situation on the ground. 

A major roadblock to the peace process is that Tigran forces are occupying parts of Ethiopia’s Afar and Amhara regions – increasing inter-regional tensions that are separate from the dispute with the federal government.

Armed Afar and Amhara militia have fought alongside federal government troops, but they have also pursued their own objectives. 

The government called on Tigraian insurgents to withdraw from these areas when it announced the humanitarian truce – what is happening on the ground, however, remains hazy. 

“Although it was not explicit, that may have been signalling that the federal authorities and their regional allies are insisting on Tigray’s withdrawal from those areas before aid is delivered,” said Mr Davison.
The ambiguity of the statement has led to confusion among stakeholders and humanitarian agencies about whether the truce is currently in place – and how aid should be delivered.
The hold-up has sparked fears that the famine is likely to get much worse the longer the region is cut off from aid supplies.
Concerns are also mounting that the truce may be a smokescreen for the government to get an upper hand in the conflict, despite Ethiopian officials talking publicly about peace. 

Hundreds of government troops have moved to a town called Kobo on Tigray’s southern border in Amhara state in recent days.
The government claims the troops are there to set up a humanitarian corridor, but local officials fear another offensive.
“Neither the people nor the regional government have adopted the truce,” said Addisu Wedajo, Kobo's mayor. 

“There is a fear that we will be at risk if the federal forces move, so everyone is holding their ground.”
However, experts are increasingly at odds about predicting what will happen next in Ethiopia. 

The lack of information coming from the Tigray region and the conflicting messages that are regularly broadcast by both warring parties adds to a layer of uncertainty around how the conflict might develop. 

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War makes for bitter men. Heartless and savage men, Abiy said in his Nobel prize lecture. @FT @davidpilling

The falcon cannot hear the falconer;

Turning and turning in the widening gyre
The falcon cannot hear the falconer;
Things fall apart; the centre cannot hold;
Mere anarchy is loosed upon the world,
The blood-dimmed tide is loosed, and everywhere The ceremony of innocence is drowned;
The best lack all conviction, while the worst Are full of passionate intensity.

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9-JUL-2021 :: The Contagion will surely boomerang as far as Asmara and destabilise the Horn of Africa for the forseeable future.

November 8, 2020 .@PMEthiopia has launched an unwinnable War on Tigray Province.

Ethiopia which was once the Poster child of the African Renaissance now has a Nobel Prize Winner whom I am reliably informed

PM Abiy His inner war cabinet includes Evangelicals who are counseling him he is "doing Christ's work"; that his faith is being "tested". @RAbdiAnalyst

@PMEthiopia has launched an unwinnable War on Tigray Province.

February 1st 2021 ‘The genie out of the bottle’ @AfricanBizMag

It’s impossible for the state to manage a guerrilla war up there and at the same time manage to control the rest of the country.

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I & M Holdings Ltd reports FY 2021 Earnings EPS +0.891% here
N.S.E Equities - Finance & Investment

Par Value:                  
Closing Price:           20.95
Total Shares Issued:          826810738.00
Market Capitalization:        17,321,684,961
EPS:             4.92
PE:               4.258  


FY 2021 Earnings through 31st December 2021 versus 31st December 2020

FY Assets 415.180677b versus 358.099793b

FY Kenya Government Securities [Held at amortised cost] 30.605205b versus 36.732012b

FY Kenya Government securities [FVOCI] 57.101222b veersus 36.635314b

FY Loans and Advances [net] to Customers 210.619661b versus 187.391266b

FY Customer Deposits 296.746509b versus 262.681402b

FY Total Interest Income 33.0814678b versus 27.848575b

FY Total Interest expense 12.204574b versus 12.248980b

FY Net Interest Income 20.876894b versus 15.599595b

FY Total Non Interest Income 8.735620b  versus 8.637753b

FY Total Operating income 29.612514b versus 24.237348b

FY Loan Loss Provisions 4.199601b versus 2.472836b

FY Staff Costs 5.896892b versus 4.464503b

FY Total other operating Expenses 17.748498b versus 12.606382b

FY Profit before tax after exceptional items 12.412906b versus 10.952004b

FY Profit after Tax and exceptional items 8.130742b versus 8.073855b

FY EPS 4.92 versus 4.88

FY Dividend 1.50 versus 1.125  


Interesting uplift in FY Loan Loss Provisions

I&M Group is currently trading at a P/E multiple of 4.1x against a sector median of 4.6x and a P/B multiple of 0.5x against a sector median 0.8%.

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BRITAM Holdings reports FY 2021 Earnings PBT 1.011b here
N.S.E Equities - Finance & Investment

Par Value:                  
Closing Price:           6.86
Total Shares Issued:          2523486816.00
Market Capitalization:        17,311,119,558
EPS:              0.02 
PE:                343 

BRITAM Holdings reports FY 2021 Earnings through 31st December 2021 versus trough 31st December 2020

FY Gross earned premium & fund management fees 32.523890b versus 28.821159

FY Less Reinsurance premium ceded [6.823395b] versus [5.053986b]

FY Net earned revenue 25.700495b versus 23.767173b

FY Interest and Dividend income 10.872447b versus 9.397384b

FY Net Loss from investment property [206.410m] versus [1.470336b]

FY Gains & Losses on financial assets at fair value 1.799672b versus [2.537790b]

FY Commissions earned 1.459547b versus 1.218404b

FY Other Income 602.224m versus [221.887m]

FY Total Income 40.227975b versus 30.152948m

FY Net insurance claims increase in policyholder benefits and loss adjustment expenses 17.840426b versus 18.649372b

FY Interest payments/increase in unit value 5.230998b versus 2.759170b

FY Operating and other expenses 11.327916b versus 13.455260b

FY Finance Costs 413.989m versus 361.547m

FY Commissions expense 4.117100b versus 3.802160b

FY Total expenses 38.930429b versus 39.027509b

FY share of Loss of associate [286.085m] versus [823.049m]

FY Profit before Tax 1.011461b versus [9.697610b]

FY Profit after Tax 72.124m versus [9.11539b]

FY EPS 0.02 versus [3.62]  


The regional general insurance business recorded an increase in Gross earned premiums of 3.3% to 8.1b 

Business now contributes 25.5% of group's GEP

No Dividend 


Strong rebound which is expected to gain traction going forward  

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Diamond Trust Bank (Kenya) Ltd.reports FY 2021 EPS +20.413% Earnings here
N.S.E Equities - Finance & Investment

Par Value:                  4/-
Closing Price:           57.00
Total Shares Issued:          279602220.00
Market Capitalization:        15,937,326,540
EPS:              13.98 
PE:                 4.077

DTB Group reports FY 2021 versus FY 2020 Earnings 

FY Total Assets 456.842717b versus 425.054034b

FY Kenya Government securities HTM 83.286893b versus 111.118568b

FY Other Securities 19.400037b versus 9.996628b

FY Kenya Government Securities at Fair Value 41.022810b

FY Loans and Advances to Customers [net] 220.425335b versus 208.592888b

FY Customer Deposits 331.451673b versus 298.166604b

FY Loan Loss provisions 7.558119b versus 7.324436b

FY Total Interest Income 33.904379b versus 31.089802b

FY Total Interest expenses 13.911806b versus 13.010309b

FY Net Interest income 19.992573b versus 18.079493b

FY Total Non Interest Income 6.307932b versus 6.122417b

FY Total Operating Income 26.300505b versus 24.201910b

FY Staff Costs 4.839802b versus 4.721038b

FY Other Operating Expenses 4.966055b versus 4.617137b

FY Total operating expenses 19.883833b versus 19.668558b

FY Profit before Tax 6.625657b versus 4.668271b

FY Profit after Tax 3.908411b versus 3.247534b

FY EPS 13.98 versus 11.61 +20.413% 

FY Dividend 3.00 versus 0 


 a P/B multiple of 0.2x against an industry median of 0.8x sums it up. 

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Nairobi Securities Exchange reports FY 2021 EPS -21.538% Earnings here
N.S.E Equities - Finance & Investment

Par Value:                  
Closing Price:           7.64
Total Shares Issued:          259503194.00
Market Capitalization:        1,982,604,402
EPS:             0.51 

PE:               14.98  

Nairobi Securities Exchange reports FY 2021 Earnings through 31st December 2021 versus through 31st December 2020

FY Revenue 550.593m versus 548.257m

FY Interest Income 105.752m versus 85.138m

FY Other income 57.922m versus 36.544m

FY Total Income 714.267m versus 669.939m

FY Admin expenses [500.010m] versus [467.212m]

FY Profit before Taxation 210.868m versus 218.914m

FY Profit after Taxation 132.534m versus 167.918m

FY EPS 0.51 versus 0.65   


• Equity turnover stood Kshs. 137 Million from Kshs. 148 Million occasioned by reducing equity trading volumes owing mainly to reallocation of capital to fixed income assets. 
This in turn led to a reduction in equity trading levies from Kshs 356.8 Million for the twelve months 31 December 2020 to Kshs. 329.7 Million in 2020.

• Bonds turnover increased by 38% to a historical high of Kshs. 956 Billion for the twelve months ended 31 December 2021 as compared to Kshs. 691 Billion during the same period in 2020. 


The Equity market has been neglected and these results reflect that  

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Kenya Airways Ltd.reports FY Earnings EPS [2.73] here
N.S.E Equities - Commercial & Services

Par Value:                  5/-
Closing Price:           3.83
Total Shares Issued:          5681616931.00
Market Capitalization:        21,760,592,846
EPS:              -2.73 

Kenya Airways reports FY 2021 Earnings through 31st December 2021 versus 31st December 2020

FY  Total Income 70.221b versus 52.805b

FY Total operating costs [77.024b] versus [79.916b]

FY Operating Loss [6.803b] versus [27.111b]

FY Other Costs [9.387b] versus [9.524b]

FY Loss before income tax [16.028b] versus [36.573b]

FY Loss for the Year [15.878b] versus [36.219b]

FY Loss on hedged exchange differences [borrowings]  [2.187b]  versus [5.168b]

FY Loss on hedged exchange differences [lease liabilities] [1.107b] versus [4.882b]

FY Total comprehensive Loss for the year [19.172b] versus [46.269b]

FY EPS [2.73] versus [6.22]

FY Total Assets 155.555b versus 171.462b

FY Total Equity [83.337b] versus [64.165b]

FY Cash & cash equivalents at end of year 6.095b versus  7.728b 


Cabin Factor 60.8%

Total Revenue increased by 33%

Group uplifted 2.2m passengers 

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FTG Holdings Ltd reports FY 2021 EPS +38.095% Earnings here
N.S.E Equities - Industrial & Allied

Par Value:                  
Closing Price:           1.24
Total Shares Issued:          161866804.00
Market Capitalization:        200,714,837
EPS:             0.58 
PE:               2.1379    

Flame Tree Group reports FY Earnings through 31st December 2021 versus 31st December 2020

FY Revenue 3.383108b versus 2.910676b

FY Cost of Sales [2.238383b] versus [1.769160b]

FY Gross Profit 1.144724b versus 1.141515b

FY Selling & distribution expenses [318.257055m] versus [272.077918m]

FY Admin expenses [481.092145m] versus [496.077842m]

FY Other Operating expenses [82.592293m] versus [68.991741m]

FY Operating Profit 262.783333m versus 306.834180m

FY Finance Cost [150.489329m] versus [158.420765m]

FY Profit before Taxation 112.294004m versus 148.413415m

FY Profit after taxation 102.543724m versus 75.180433m

FY EPS 0.58 versus 0.42 +38.095% 


 Flame Tree Group net profit up by 36.4% (102,5 million).
 Sales increased by +16.2% up to 3.383 million.
 Gross margin growth was minimal due to increased price of raw material & international  shipping costs
 March 30th 2022, Nairobi - FTG Holdings (FTGH: NSE) the diversified manufacturer and distributor of plastic tanks, cosmetics, snacks, spices and playground equipment, has announced a 36.4% increase in net profit up to KES102.5 million for the FY 2021 from KES75.1 million posted the previous year.
  However gross margin dropped from 39% to 34% following sharp increase in international oil prices and exorbitant increase in international shipping costs, which affected the cost of our raw materials.
According to Mr. Heril Bangera, CEO Flame Tree Group, “After a very challenging 2nd year of the Covid pandemic and unprecedented increases of oil prices and international shipping costs, which have impacted negatively our cost of sales, we are very satisfied with the results achieved this year, and continue to show a remarkable growth for the fourth year in a row as well as a strong and healthy financial position, with a low Net Debt/EBITDA ratio, x2.4”.
“Our receivables have been kept under tight control and the DSO ratio improved by another 3 days,” said Mr. Bangera.


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by Aly Khan Satchu (www.rich.co.ke)
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March 2022

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