Equities Market Closes Week on a Bleak State

The Kenyan equities market closed on a bleak state as portended by the market indicators and the value of transactions. The NSE All Share index dipped by 0.90% to close at 145.61 points while the NSE-25 share index posted a 1.16% decline to close at 4205.69 points. The NSE- 20 Share index plummeted by 1.11% from 4009.26 points to 3964.65 points. Equity turnover contracted by 52.01% to close at KES 1.61Bn from KES 3.36Bn the previous week’s close. Market capitalization similarly shrank by 1.32% to close at 2.08Tn.

Home Afrika Limited (NSE: HAFR) plunged into a loss of KES 390Mn for the FY2015 results from a profit of KES 8.96Mn the previous year. The loss was attributed to reduced sale of plots in the property developer’s various project that saw revenues drop 62.2% to KES 259Mn while a 955% increase in finance cost to KES 132Mn further weighed in on the firm’s bottom-line.

The loss per share rose to KES 0.91 from KES 0.40 for prior year. The company in line with its accounting policy booked an extra KES 0.1Bn in deferred income and deposits from sale of plots as current liabilities bringing the total value to KES 1.8Bn.

The liabilities are expected to be reported as revenue in the next two years as it seeks to increase its percentage if completion (currently averaging at 40%). With the flagship Migaa Golf Estate expected to be completed in the next two years, half of the deferred income is forecasted to be turned into revenue in one to one and a half years and the remaining in latter period based on the percentage of completion.

Weekly Foreign Equity Turnover

Foreign Turnover on the top 5 traded counters accounted for 87.58% of the total weekly foreign investor activity with a dominance on the sell side, as majority of investors engaged in distributive activities.

The purchase activity on these counters accounted for 62.93% of the total foreign activity. Equity Group Holdings Limited (NSE: EQTY) took the prime position recording a total weekly turnover of KES 807.40Mn, followed by Safaricom Limited (NSE: SCOM) which recorded volumes worth KES 606.55Mn during the week.

Article by Genghis Research.