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Nairobi Securities Exchange Stock Picks - March 2014 - myStocks: Opinion and Commentary

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Nairobi Securities Exchange Stock Picks - March 2014

By Cannon Asset Managers (Cannon Asset Managers)
Comments Tuesday, March 25, 2014 at 8:29 AM EAT

Summary

SectorStocksCurrent Price
BankingCFC Stanbic107.00
InvestmentsCentum Investments37.25
InsuranceBritam18.50
EnergyKenol9.55

CFC Stanbic Bank

 Investment Consideration:

  • Consolidation after the merger.
  • 70% rise in PAT FY2013
  • Attractive valuation compared to its peer. Price to book of 1.3, sector P/B 2.2

Centum Investment

Investment Consideration:

  • Real Estate play - Uganda and Runda development
  • Rea Vipingo offer - 10,000 acres in Kenyan coast
  • Strong major shareholders- to increase share holding from 24 to 29%
  • Recent acquisition of second largest Kenya Asset Manager

British American Investment Company- Britam

Investment Consideration:

  • Recent acquisitions of Real Insurance resulting to Britam becoming the 2nd largest General Insurance Company and the largest Ordinary Life Insurance Company in Kenya.
  • Acquisition of 25% stake in Acorn Group, a renowned property development firm will boost the company’s property business strategy.
  • Launch of new products which have become favourite with the market- Linda Jamii

Kenol Kobil

Investment Consideration:

  • KenolKobil has the largest overall market share (including exports). The company operates in 8 African countries giving it a wider coverage compared to other local players.
  • Recovery from a loss in 2012. Half year results in 2013 reported return to profitability.
  • Remains a target for take over for any petroleum company looking for a stake in East and Central Africa
  
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