Safaricom Hits 25.1 Million Subscribers #CytonnReport

The Communications Authority of Kenya (CAK) released industry data for the quarter ended March 2016, which indicated that Safaricom had a 3.1% q/q increase in subscriber numbers to 25.1 million, resulting in an increase in market share to 65.6%, up from a 64.7% market share in the previous quarter.

Mobile penetration in the country increased by 1.5% to 89.2%, from 87.7%, in December 2015, driven by an increase of 3.5 million subscriptions leading to total mobile subscribers of 38.3 million.

According to the report, Safaricom recorded a 0.9% increase in total subscription market share to 65.6%, up from 64.7% in the year ended December 2015, while Airtel’s market share decreased to 17.5%, from 19.2% as of December 2015, after disconnecting over half a million sim cards in compliance with the new sim card regulations.

The minutes of use per subscriber per month in the industry increased by 4.7% to 93.2, from 89.0 in the previous quarter.

Read: Safaricom Launches M-Pesa Bill Manager Service

Internet subscription increased by 3.8% to 24.8 mn, translating to internet penetration of 87.2%. Mobile data market share changed slightly with Safaricom’s market share declining to 60.8%, from 63.0% in the previous quarter. Airtel and Equity’s Finserve gained a larger market share, with Airtel registering a 21.0% share, up from 18.0% and Equity registering a 6.8% share, up from 5.0%. Orange’s market share declined to 11.2%, from 14.0%.

The number of mobile money transfer subscriptions was 24.8 million whereas the number of mobile money transfer active agents stood at 147,761, with Kshs 840.3 billion transferred among users during the period. Value of M-Pesa transactions stood at Kshs 764.7 billion, equivalent to 91% of total amount transacted via mobile phone.

In other business news according to #CytonnReport this week, the government is ahead of its domestic borrowing schedule, having borrowed Kshs 373.8 billion for the current fiscal year compared to a target of Kshs 214.3 billion (assuming a pro-rated borrowing throughout the financial year of Kshs 219.2 billion budgeted for the full financial year). With only one week left to the end of the current fiscal year, the government has surpassed its local borrowing target. The additional Kshs 159.2 billion above the target will go towards plugging the tax collection deficit by KRA. The government will look to shift their attention to achieving the foreign borrowing target and start front-loading for the next fiscal year. With interest rates still coming down, but showing signs of bottoming out at the current levels, we advise investors to lock in funds in short to medium term paper for tenors between six months and one year as the rates are attractive on a risk-adjusted basis.