Kenya to benefit from Botswana’s Choppies KSh 29Bn expansion plan

Botswana retailer Choppies plans to expand presence in Kenya and Tanzania in its  40 new stores expansion strategy by mid next year.

In its USD 29 million (KSH 29 Billion)  expansion plan, “4 further stores will be added in the current financial year. The new sites are under negotiation and this will deliver critical mass and profitability,” according to the retailer’s financial results for the six months ended 31 December 2016.

According to Reuters, Choppies plans to enter Namibia before December while expanding its presence in South Africa, Kenya, Zambia and Tanzania, Chief Executive Ramachandran Ottapathu.

“This will be funded mainly through the internal resources and the balance through a combination of debt/bonds within the debt covenants.”

The retailer projects it would grow its stores at a compound annual growth rate (CAGR) of 6.4 in the next five years.

Cytonn Investments project the country’s retail sector to have a growth Compound Annual Growth Rate (CAGR) of 7.4 percent in the next 2-3 years.

According to Cytonn, Kenya’s growing middle class has been the driving force behind the growth of the retail sector. Other factors include foreign investment attributed to the current growth of the Kenyan economy, that has averaged over 5.1 percent for the past 5 years, infrastructural development and e-commerce.