Wednesday, December 13, 2006

Foreign investors

Dont you just love the way kenyans have taken to the securities market and are looking for any small or big opportunity? last monday i was at standard stocks and discovered they have oppened a dedicated hall to handle IPO traffic. i found many people applying for MSC but a number were also applying for the stanbic IPO in Uganda. stanbic UG is said to be the largest bank in UG and offers services to all government bodies and NGOs. its also the only bank in rural UG. sounds like KCB of kenya but without compe from BBK and stanchart. its not clear how robust the investor public is in UG. but at 2.85 /= kenyan money and by Kenyan standards, this IPO is very 'cheap'. MSC is going for 49.50 and some pple are grumbling that its too high. some rumor mongers have it that the price will drop to 30 in januray. i never know hoe kenyans can tell such things but they do.

if UG does not watch, then stanbic will be over subed by kenyans alone. they will probably have to watch out and limit the thirsty kenyans. this will happen after project fame has seen only kenyans take home the grand merc as well as positions 1 to 4. however on the project fame i dont know how that is good for business. i also dont know how that helps our relationship with TZ. those guys are already paranoid.

if kenyans override that stanbic thing then UG may hav to got the TZ route and follow the adage, that if the brain fails try the fist! however the 'behavior' is very refreshing

odegle tip of the day -- before investing, make sure you set up clear goals , objectives and policies. these can guide you in what you are doing. investing should not be a by the way and the way you treat 10 bob should be the same way you treat 10 million bob.

Sunday, December 10, 2006

oiling the wheels of consumerism

i spent much of last week with the leaders of the cooperative movement. the seminar had been organised by their bank to chart the way forward. it was necessary since they said that commercial banks were eating into their market and threatening the very survival of the coop movement. the bank is fully owned by the coops and is probably the only bank where directorship is not determined by the number of shares owned but rather by the number of individaul votes one can muster. the coop movement has really helped develop this ocuntry and currently many countries are sending delegations to kenya to learn the business and implement it in their counries. i know at least two Kenyans who are 'consultants' in SA on the coop movement.

the coop business model is based on a simple principle, save and borrow. this encourages pple to save and also borrow from the commmon pool. its a very good model which created both a saving culture as well as financial discipline. pple invested and broke away from poverty on sacco's . we also know that in the 80's and part of 90's it was invariably missused as was everything else by the rulling elite and by the greatest monster of all - tribalism.

right now , the sacco's survival is threatened by availability of very cheap credit offered by banks who have suddenly found themselves with too much money and impopsible targets to meet. just 4 years ago, commercial banks kicked out poor savers by increasing their minimum balances to extreme levels. they proceded to close some branches in remmote areas. thats when pple turned to sacco societies to process their loans, payments etc. at that time, the sacco fosa was born. this was a rudimentary banking service offered by these societies. now those same commercial banks are knocking at the doors of the same custormers they threw out and offering them upwards of 2000,000 bob unsecured loan for as long a period as 5 years! on top of that they can give you credit card valued at 1 1/2 times your salary plus interest free overdraft. what this is translating to is massive and unbriddled consumerism. the saccos are also trying to keep their ground and trying to match the banks by loosening their lending requirements. this is a very dangerous precedent. pple are getting indebted to their necks and we may soon see a repeat of what happened in america when they had a personal debt crisis. americas market was more sophiscated and they were able to solve that problem by moving the laibility from the card companies. in kenya it may be a diff ball game. sacco savings currently account for almost 30% of total savings in kenya , if they collapse due to consumerism being oiled by banks then we may see a very huge dent in the available savings per capita in kenya. its funny that this is happening at a time when other countries are looking to kenya for lessons on the sacco model.

i have never heard this but this time, the shareholders of KPLC waited in vain for split and had to ask for it themselves! thats definitely new.

the slow down is on in earnest, but mostly due to MSC offer. pple are liquidating to buy MSC

odegle tip of the day
-- its important to build a good asset base first before spening. it helps to try and make the assets outweigh liabilities for personal financial security. remember an asset must be able to give future benefits. stocks are some of the best forms of investment especially if you are young.

Wednesday, December 06, 2006

Celebrity stunts

Last friday i went back to blue corner restaurant and decided to forgive them for their yorghurt (read milkshake) however the main reason was that they advertised a certain unique musician who does his music just the way i like it. Tony nyadundo. i did not have much to do in the early evening however i also wanted to give him time to settle down and play a few songs so i went at about 8:30, but he hadnt arrived and so i decided to do some window shoping and also buy an umbrella while at it. i got back at 9 and the man hadnt arrived, so i ordered a drink and told myself that if i clreared it before he came i would give up and go home to stare at the TV. the place was packed like i have never seen before. i wasnt even sure it would be this way. people were literally drinking on their feet. I met a number of my work mates who had snubbed a well advertised and oiled mugithi night for this. however towards 9:30, the mans equipment started arriving. shortly Tony himself arrived to quite a warm and enviable welcome from the crowd of mostly young , kenyan professionals. in the follwoing short minutes he showed why he is king and a real celeb by the way people even danced as he tested the equipment.

the excitement was real. this guy's music has been enjoying fair time in discos and other social joints and so most pple were just thrilled to see the real man in person.
However the testing took more time than i expected and after fidgeting with the equpment for a while he announced that the sound system was too bad for him to sing. i thought he was joking, after he went ahead and did one song to which pple danced where they were standing, the dance floor was packed to the brim. Tony however sotpped abruptly and announced in 'kiswahili' that sauti ndiyo inasindilia mimi kuimbilia nyinyi he then casually replaced the mike and walked away!

come monday and fate was not finished with me yet, eveready OFS returned a whooping 800 X over supscription! against my wise judgement. to say the truth, i dont understand how that was posible. does it mean people actually beliv in that comapny that much in spite of their books? however i still hold that price appreciation will depend on whether the enthusiasm will hold after the allocations are done and refunds are made. if this is not handled properly then there may be fatigur and apathy during the coming IPOs coz pple will be tired of low allotments and refunds all the time.

Mumias also finaly calmed the rumours and hit the market at 49.50 and 200 minimum. kenya being a price sensitive society, we already started hearing grumblings about teh price and there are fears that it would be undersubscried like the first IPO based on this offer price. however if fundmanagers decide to take positions like they have done before , the IPO would be fine. however what i can say is stop the joke about speculating with eveready and go for value in MSC

on another front, BBK has listned to my gramblings and upped their personal loans to 2,000,000 . let the games begin and may the best man --- sorry may the best bank win! however there are a number of conditions on the BBK loan and caution is advised.

and that was after KQ, stamped its authority by winning for a second time , the most respected firm of the year. i covet that award since its your peers who recognize you. there is no better respect than bein respected by your peers, equals , competitors. i would like to be naikuni for a day! how come safaricom didnt win? does it mean eas africans do not admire profitability? does that even explain why the stock market snubbed such good news

odegle tip of the day --- Cash driven investors- these are people who invest at the NSE because they have money. Maybe they just got their bonus or commissions or they won a charity sweepstakes etc. they will buy shares just because they have money to spend. These same investors will sell their shareholdings just because they urgently need the money. At the NSE this mostly happens in January when retail investors are selling to get school fees. Also in January people are generally broke following the free will expenditure of December holidays. Other investors make lots of money from cash driven investors

Thursday, November 30, 2006

In praise of the Blogsphere

I got into this 'mess' after reading Onyango obbo one fateful thursday last august. Mr. Obbo is a favorite columnist whom i wait for the way i wait for clay court every friday. after reading a few interesting posts, i said to myselft, who am i to ignore this great media to hear and be heard! well now it has only been 3 months really and since am proud to be kenyan ( i think kenyans are the best people every created) i read only blogs by kenyans; be they in the diaspora (where is that) or back home enjoying good food and decent weather. what has amazed me is the quality of the posts on these blogs. before i started blogging and reading blogs, i knew i could hold a slightly lenthy intelectual conversation on investments, finance, IT, family life, art, culture , life in kenya etc. but right now, i get to read deep articles on a variety of topics like international trade and politics, successsion , Raila Odinga, mergers and acquisitions, art culture , life i the US, SA, europe and even nigeria. all great experiences of the great sons and daughters of Kenya! I must say am greatly fulfilled. some bloggers have double or tripple suprised me at their grasp of whatever topic comes up. they give very intelligent comments on virtually any topic , they are well versed and passionate. i dont know how they do that. but i know they make me more proud to be associated with them

others however are perched safely in some foreign civilization, from where they ride on the hard work of those guys and hurl insults at our beauty in the sun (lately beauty in the flood!) nay beauty in the rain sounds better. some have said that we need to sort out the mess before they can come back to kenya. however i dont think thats a good idea. kaeni huko huko tuuu!

in fact in this blogsphere i even met long lost guys like cartoonist gathara, who happens to be an alumnus of the same chep where i also went. gathara was my favorite cartoonist . i wonder why he disappeared from 'nation'. his cartoons are a refreshing break from Maddo's cartoons since he is unique, (maddo has been in my life since i was in primary school. a great artist by any standards) by the way i also learnt on the blog that they are called caricatures and not cartoons!

another guy i met is a mr. otieno who knows more english than the queen of england, thank God he has not 'edited' my blog yet. if he strays onto this one he will collapse since the gramer and speling are patheticq.

However i discovered through the blog that the favorite topic of all kenyans criticizing their beloved country since they want it to be sublime! this love is amazing

i met this guy ( a kenyan) who told me he had a really difficult life growing up in a third world . he said that he will not allow his kids to be brought up in a third world country. he is determined to see that. he is also not leaving Kenya!

Wednesday, November 29, 2006

Best Employers

The fortune magazine prides itself in being able to provide information on the best employers in the world at any given point in time. i think they mostly look at the working enviironment, cooporate culture, pay etc. i have never seen any kenyan firm feature in these global things. however the other day i went to what i think must be the best employer. i was queuing outside the cashier offices at the university of nairobi. i had been sent by a friend to pay some money for her. she was required to retake an exam since the university had lost her results but thats another story.

ok so am waiting on the line to deposit the banking slip for the 500 bob retake fees. then as i was about to be served, yes i was the person at the window and no there was no one behind me, the clock struck 1PM and the cashier closed for lunch! he told me, nay he threw at me words to the effect that i come back after lunch. my pleas that i was the last in the queue and that it was just 500 /= banking slip fell on deaf ears. he closed everything. now i guess that guy works for the best employer in the world. if i try to pull such a stunt where am currently being overworked and underpaid like everyone else, i would pay with my skin.

that was happening after i had to plead with the watchman to allow me park inside the compound since i was a visitor and coming to pay money. he said i needed a sticker but if i had 'kitu ya kukula' he could allow me in. i promised to give 'kitu ya kukula' on my way out. he was dumb enough to trust me with that. and talking of watchmen and parking lots, its happening a lot. the other day i saw these guys roll stones or put barriers onto empty parking lots so that you cannot park. they only allow you after you give them kitu ya kukula. on top of that most of the empty slots are reserved for CEOs, Managers etc so its your problem as a customer to find your parking so that you can come and give us your money. how is that for customer care? after all the rider in the premisses reads "the customer comes first" isnt that enough? anyway providing parking places in the city is probably the easiest way to beat the stock split gains at the NSE. (you need to pay for that business idea)

otherwise, you can accumulate more mumias sugar shares, this time i have reliable information from a broker who is close to trancentury (those guys are in turn close to kimunya, and by extension Kibaki) the info says that the offload will be based on application like an IPO. the price is 49.50 and minimum is 500 shares. this info is actually not new since its on ther sites as well. how will investors react? wait to buy at 50 bob? maybe not since there will be oversupscription. what i wonder is how they plan to increase the share capital without a split or a rights issue. but based on what has happned in the past, they can simply drive the price north at 400Km/H then split it once it reaches 200 bob. again when the new shares start trading, there is nothing stopping them from shooting the price to 400 like in the case of city trust. however that is speculative and since i have failed more than once as a speculator, do not invest based on that. just invest based on the fact that MSC is going to be one of the best companies in kenya. (already its in the top ten club by capitalization)

elsewhere , KPLC shares seem to be out of stock even though the price is dipping! someone knows more than the rest of us. instead its jubilee and nation that are skyrocketing. a haven for speculators.

I wonder whether EAC share holders are enjoying their gravitational free fall

how will the festive season affect the NSE this year, i expect it to be different given the hightened activity. most pple who want to make moeny will somply refuse to close shop!

odegle tip of the day -- capital gains should not the only reason to invest, also passion and corporate social responsibilty

Monday, November 27, 2006

discounts , loyalty et al

nakumatt supermarket initialy got me hooked to their stores mainly because of the professionalism, the cleanness of the shelves, the availability of the products etc. that was when uchumi guys were literal bitting the hand that fed them by shoplifting their own shop. well nakumatt went a step further and introduced the loyalty card. i could get points whenever and wherever i shoped. very sweet. to me it became a passion, i could see my points grow and that felt like seeing my savings increase. on top of that it shows me how much i have spent on nakumatt the whole year. i just multiply my points by 100. it sometimes depresses me but mostly it just gives me an easy way to account for my money. apart from that, i have used the points before to buy shoes for my kids from bata, buy myself some clothes etc. in short that loyalty program of nakumatt is so important to me that i look forward to shoping there just to earn points! well you can therefore imagine my frustration after doing my largest shoping yesterday and being told that my card is blocked and so i dont get to earn my points! why is it blocked in the first place? they told me its coz i reported it lost. well of course i didnt have a comment for that. how can i not know when i report my card lost?! since i got mad, i was sent to the card supervisor. invariably he also told me that i must have reported my card lost! and he added that the card guys dont work on weekends so that card can only be sorted on wednesday. how convinient, weekends is when they have the highest traffic and they conviniently close shop and put their legs up! anyway their service and shelf status is still good.

does anyone know when and how mumias will be offloaded. dont you just envy those dyer and blair guys , they are the fifa, the referee and a player! either way things are looking up. what i fear is that if the govt decides to give 20% of the shares to farmers, then the price will be depressed until all of them are mopped up by other private guys. last time farmers sold their shares at 2 bob, the price was down until the excess shares at that low price were all taken up. i cant help but see history taking a troden path.

what of the roads thing, will the govt remove fuel levy once they privatise those? otherwise using cars will be a nightmare. however if those private owners start by making some great roads or improving on the ones we have then it will be ok since a lot of savings will be got from efficiency.

and talking about roads, i took the kangundo road last friday evening and met 3 seperate accidents, some fatal. what suprised me about that road is that its does not have potholes, but its horibly uneven. why would someone want to do a job like that? is it because he is african or because the west is unfair to us or simply because he or she does have self respect and self discipline? secondly i think its time we started making dual carriage all through. i suppose it will ease congestion and also reduce accident cases especially after the friday binge

however i am proud to be kenyan! especially after reading philip ochiengs column yesterday tillted "Maathai mara" it was a masterpiece to say the least

odegle nyang tip of the day
-- investing in mutual funds literaly means having someone decide on how to share your returns with you

Saturday, November 25, 2006

of Southerners and franchises

yesterday i made a mistake of phenomenal propotions. well i may be going too hard on myself. i walked into a steers shop and quickly ordered one dinner box and milkshake (i have been warned before that milkshake, especially strawberry is feminine. the world hates us!) well i was pleasantly suprised that they serve people these days. so i went and sat down to wait for my order. just when they brought the 'dish' i remembered my oath once of never to touch chicken from steers ever again! for one the thing had too much make up (you could think it was bread crumbs coated in chicken) secondly, the little chicken on it was looking like it had been dead for at least two years. i have known this before and i couldnt help cursing. you see i had gone into steers coz i was starving after a full day struggling with parastatal bureacrasy and incompetence. in the end they won as they always do but that is a story for another day. back to steers i kept on struggling with the bread crumbs and milkshake. at least their shake never disappoints. am told that the steers franchises import every thing including drinking straws from south africa! the only think kenyan is probably the customers. no wonder the food is so bad, but that also amazed me since i used to crave for this very food when i was younger. in fact i would bring my date to the joint for a quick bite to show how capable and loving i was. steers used to taste great! oh what age does to people!

and that happened after i had come face to face with the fastest growing and indeed the mainstay of the kenyan and world economies - small and microenterprises. (however by definition of standchart an SME should be having at least 4 million working capital ) what shocked me about these SMEs was the number of brokers hovering around their corridors! i wanted to hard cover bind a book. in the end i met hundreds of pple who could 'do' it but who could not even tell me how long it would take. the price ranged from 40 /= to 1000 /= per book. i walked until my feet hurt and finaly got some young suave gentlman i could trust. he offred to do it in 2 hours at 200 /= since he does it himself i left him with the stuff. it was when i went back to collect them that i discovered that he was also a broker! in the end i never met one person who actualy does the job.

it reminds me when i used to trade in fish sometime when i was a second year. i could buy the fish for 15/= to supply hotels in mombasa. what i remember is that i could not buy the fish from the owner. there was always an agent who sold to me the fish. in fact i cannot tell how much the fish used to cost from the fisherman but between me and the fisherman there were --believe it or not -- 4 other people! With all these brokers , who is working?

but i think brokers arent bad even though the stock brokers are fleecing us left right and center if the stories in the blogs are anything to go by. i think distributors , wholesellers , retailers and indeed everybody in the supply chain are indeed brokers isnt it?

I wonder how the eveready OFS concluded. by Thursday less than 50 % were taken and there was faint optimism that it would pick up on friday like before. but remmber that happned because of institutional interest. if that is not there then it would not work. however, i dont expect these guys to annouce an undersupscrition even if its there, they are crafty enough to simply buy it all and write it off after all they are just selling their shares and not really looking for new money.

but mumias has started rising in anticipation, and nation shows great potential given the split euphoria and its current price

odegle tip of the day -- there is no point chasing bad money with good money. if its a bad investment just get out.

Tuesday, November 21, 2006

Mumias at the door thumbs down eveready

just like men (and women) can tell the signs of the times from the falling of leaves from trees, mumias sale seems close by as adverts flood the media like the rain at the coast! strategic targeted advertising to whet our appetite. however am yet to see anyone going the route kengen went. people only talk about the overwhelming interest in kengen yet they forget to give credit to the advertising company. there were billboards all over and every little media space told you about it. Kiss fm even ran a show where the MD was present and people won share holding in the energy firm. if mumias goes this route probably hell will break lose and those queues will visit our streets again. as for eveready, am told only a few brokers like nyaga are having those long qs. however most brokers are not enthusiatic and have sort of discouraged their clients all together. this is not new since bloggers have been drumming this over and over that the sale is not an ipo but a dump. again it should be noted that the material gain that happens after the ipo is due to post ipo interest and not necesarily oversupscription

and as that goes on, the revelations on safaricom have raised more questions than answers. the worse part is where the govt tries to convince pple that they did not know. What! how can you not know your partner when you are the one with the bigger shareholding. give me another joke. and by the way, these revelations have come since safaricom has raised a lot of interest. how much dont we know of other firms which dont raise as much interest. and is it true that the govt owns 60%?

but the other counters that were predicted to go down at this time instead are going up. the likes of sameer and co. december is however a very tricky month with both optimism and festivity. traders and investors behave in a disjointed manner with no traceable patterns.

Odegle Tip of the day -- focus and time helps ants build those masterpieces!

Friday, November 17, 2006

is corruption african?

aftre ghana lost to brazil in the last world cup, i heard one lady comment that she was so frustrated for being an african since everywhere she looked africans proved to be perenial under achievers. i felt sorry for her but knew in my heart that that was not true. in the same breadth another person claimed that africans are geneticaly corrupt. and true that felt unconfortable though i know i abhore the practise. but lately , like that lady every where i look i meet corruption, my former classmates are going places and puting up palatial houses driving guzzlers etc because they are openly corrupt.

this last week, has been worse, i honestly had a lot of respect for Saitoti all along, i think he has been a very good inspiration as far as leadership is concerned. i did not think he would take back his position. in other countries, ppple resign just because of suspicion. meaning when you are in high office, there should be no doubt about your character. i thought prof would feel the same and keep out of cabinet. i respected mwiraria more for refusing to wait to be sacked and resigning. if he does not get back i will be happy that at least i have someone to hold as a role model.

but when i was thinking about that i get this long email from the GM of the marketing society of kenya of which am a member, she has several allegations against the cahirman who had earlier demoted her with neither warning, nor notice. the allegations were damaging to say the least and it reminded me of mutua and the association of journalists. i dismissed them as last kicks of a demoted GM. however this morning i have just recieved an equally long list of fresh allegations from a member of the society who is pissed off by what he calls grand corruption at the society. one among them was that when we went for the jugding at the ASK show we were supposed to be paid 5K each, well we were about 160 and i didnt even know that we were paid. even the friends i made there dont know that we were paid 5K each. yet it was reported that way! the other funny one is that he gave his friend 20% commision to market and sell gala and dinner tickets yet the function is always over subscribed, pple come for it so no need to even market it leave alone give commisions
and many others. when he was introducing us, that same chairman said that as judges we must be above board and not have even a slight rumour of suspicion to corruption. well .

and this is happening after an embarassing show of dirty linen between the KFF chair and a mister Philip who was heading a parallel league.

yet the west is not done with me and today they released a list of personal development and as expected africa is holding the bottom of the pack. what i found supprising is that Uganda is placed ahead of my beloved kenya. that i dont agree with or i hate to agree with.

but if what bloggers are saying is anything to go by, poor and weak africans will soon die and the continent can remain for strong rich people who can afford life after its privatised.
that will probably happen after mumias has been fully sold and has acquired other inept millers.

elsewhere safaricom is set to enter the NSE, safaricom employees have been assured a generous cut of the pie . others who will benefit before the rahia are the dealers who are also called business partners. Safaricom will surely be a great motivator of the market.

other debates are suggesting that come next year, the nse may be challened by change of guard, of course no one would want that but again investors may be wary of what happens if Kiabki wins, the man is heading into his eighties and its not a very good feeling. one wonders what would happen when we have kibaki at 80! would the economic tempo hold? the memory we have when he was taken ill at the begining of his term is not very comforting.

odegle tip of the day -- oversupscription alone does not gaurantee post IPO capital gains rather its sustained post-listing interest in the stock that makes IPOers gain.

Thursday, November 16, 2006

benefits of war

Standard Chartered has started showing the positive signs of war, by introducing for the first time, a grace period with the personal loans. however they are still cautious and will only offer a maximum of at 1.3 million payable in 4 years. BBK already offers the same amount for 5 years. what i think is that those who can afford these loans would probably need more for meaningful projects like say 3 million. lets hope for more compe, soon we will have our cake and eat it too like in china where banks are being induced to raise their interest rates. in kenya the fear is that since our MPs did what they are best at and voted with their tummies against the finance bills, interest rates will go up as the govt is forced to borrow from the market. this will also divert most money from the equities and slow down our millionairisation!

on the millionaire thing, a debate is raging ragarding one MP's comments on the NSE, drugs, and laundry. every investor worth his salt has thrown an insult or 2 at the MP and even threatened dire consequesnces for his irresponsible remarks

but the NSE doesnt seem to care, its only seems hell bent on punishing those pigs who rushed in to cash out on EAC, ICDC, olympia and the likes. EAC has seen its share plumate to a low of 40s meaning that in real terms it has gone down from 1000 just a few months ago, (2 months to be precise) to the low region of 400s. while olympia lost almost 50% in about a week. when thats happening, innocent city trust investors may be left with highly priced jewels that they cannot sell.

this is what happens in a real market. you meet crooks and saints, cops and robbers. in ours, there are no cops. or the cops are the robbers. you are on your own so be extra careful and enjoy the bull.

meanwhile mumias keeps on smilling at me and showing her great beauty. well am alraedy hooked. KQ on the other hand has been quite docile yet we all know that given its financial statistics, its probably one of the best buys. others you will never go wrong with are BBK, EABL, BAT , BAMBURI etc

odegle tip of the day -- Warren says you must invest in a business which is so sure of success even a fool can run it since soon a fool will run it. well i agree with him, but only if you are too old to take risks or are hopelessly risk averse.

Tuesday, November 14, 2006

Up for Grabs

going by what the minister said yesterday, one would be forgiven to think that the country was up for grabs , literaly. after selling rights to the railway for at least 25 years, the minister is proposing concessioning the road network. meaning that private business men will be allowed to man the roads and charge tolls. this is after the govt has taken almost 50% from the price of a litre of fuel as road maintenance levy. on top of that the govt will sell more kengen, kplc, mumias, kenya re , telkom, safaricom, nairobi city council, KRA, KPA, pipeline , Kenyatta national hospital etc. the country is on auction. at this rate i guess even the administration of the republic will be auctioned. it sends me to the fundamentals, what is the duty of the govt?

one would then starting going to things like provision of security, infrastructure, health services,leadership etc. in short govts are social service providers. it started with commercialization of abolution blocks in the city, then water services, then health and the list went on, now when roads become private property, then we could as well wind up the nation and go private, problem is the weak will become weaker and die. but then darwin will only be too happy in his grave!

elsewhere, brokers have adamantly refused to move with the times, my brokers website has been under construction for ages, they have one email account which they told me they 'download' every morning but my email orders dont get actioned, the fax line doesnt go through and the phones are unanswered. the funny part is that they have employed very able suppport staff and when you go to the office personlly you get very good service and your orders are done almost immediately. so that keeps me going there just the same way you go to the same barber who has nice stories and good workmanship but pathetic barber shop!

eveready is on but i just dont feel it (thats teenspeak) i dont know whether it feels me but things dont seem right, owners are dumping it. strong guys like icdc and merali . why? dont know but battery manufacture may not have a very good future, its time for paradigm shift but these guys havent said anything like that. however the kenyan public will gain since its cast on stone that IPOs will be oversubscribed. another offer is for family finance, if i had an account there, i would have taken that. otherwise, kenya re and mumias are far much better. however going by the direction of the nse index, guys are liquidating the buy eveready.

odegle tip of the day -- in a perfect market, there are no transaction costs, no taxes, no commisions and no secrets. everybody has the same information and so on. in short a perfect market is utopia.

Friday, November 10, 2006

splits, ipos, bonuses, et all

the market is behaving! i think thats the word. in fact pple in most sites are not asking about company performance, or management style or even industry prospects but rather whether the share will be split in the near future or whether there is a new IPO. others i hear even plan to open an account with family finance in order to be able to buy their shares at first offer. and the directors are all singing encores. splits and bonuses are the order of the day and we are all happy.

even BBK yielded and tried to go the EABL way by being a little mean and doing 1 for 3 and 5 split instead of the 10 that would be more lucrative to speculators. that would mean that if the barclays trades at 600 at the time of the split it would be 120 which is not that 'cheap' anyway. however now eyes are on nation, kplc, jubilee etc since they are too expensive for the poor kenyans.

i have cautioned before and i will do it again, i think there could be money laundering of sorts in the NSE or pple are raising campaign money from legitimate sources such as pension funds by hype and splits. splits make your gains kinda permanent. eg, even if EAC were to go down to 40 bob the real cost would still be 400 bob. still better than the 28 it was a few years ago. to be safe therefore i think retail and even institutional investors need to watch out only for firms with strong financial foundation and good management even though the gains would be low but at least there would be security of sorts. if citi trust is anything to go by, we may be approaching worse days. caution may just be the word.

next week eveready IPO starts, and from the short memory, we know that those things are normaly oversubscribed so most of us will rush there and expect to make quick cash and bolt. long memory however brings to mind sameer africa which traded above its ipo price for the first time this week, KQ which struggled for long, mumias etc. anything can happen in this market. so take care. bottom line its important to know the business and convince yourself that its the kind of business you want to do. is batteries your thing in this industry /country? do you agree with the strategy etc. sometimes it even helps to concentrate on one particular industry say energy and put all your efforts there and so on

odegle tip of the day -- its a folly to try and cash in at the last hour, most times you will burn your fingers and provide fodder to others

Wednesday, November 08, 2006

Deja Vu

in the early days of african 'liberation' we had many cases of abuse of power, tribalism , despotism and all the negative isms that one could think of. in fact even though we were supposed to be celebrating, africans were mostly wallowing in untold suffering , torture, harrassment etc. all these vices were financed heavily by both the capitalists led by america and her alies and also the communists led by russia. actually the history is very well known. the OAU meetings became a fashion show of sorts as african heads turned themselves into demi gods. they had unlimited access to 'foreign aid' from all sorts of corners. the money came in forms of road support, hospitals , schools etc. all that lasted as long as the cold war and when it stopped the aid became a loan and africa became the most indebted continent in terms of gdp/debt ratio. the west started chasing their hitherto proteges for repayments, economic disciplines and what they called democracy. well we all know the history.

fast forward, china becomes a superpower in spite of the lack of 'democrasy' and now with all her population strength and all the money. they are turning a blind eye to anything negative and are only forcusing on what they will get. african heads have been meeting the leadership of china and many of them came with lots of goodies or promises of them. china is even supporting nations like zimbabwe and sudan! all they want are what remains of africa, and our tribaly elected leaders with little negotiation skills are swallowing hook line and sinker. they will soon die or retire and leave younger leaders with the burden.

If you ask me china is not a very good trade partner, they produce too much and that means that you cannot sell to them. their products have caused even industries in SA and USA to close since they are quite cheap. secondly these guys are many and many of them will want to settle in africa and fight with us for the meagre resources as well. right now the west does not care much about africa since they have other problems with the terorists, read oil lords.

Is there any information yet on Mumias? i was expecting something this week if the november date is to be kept.

Sameer will not relent even though i keeping going at them on an on. i guess they are just ignoring me. other rumours suggest that a south african is eyeying the pie. and sasini aparently is making 10 times more than it used to do before branding. good stuff. its interesting that most strong funds avoid these smaller counters and concentrate on time tested big rollers like the bamburi, the BAT and EABL of these world. if you are a long timer, then those are your best bet. in fact in the high circles BAT is rated best in terms of management, leadership and the like. by peers.

yet BAT remains at 190 for heaven knows how long! its guys like city trust who can jump a massive 400% for annoucing a dividend!

odegle tip of the day -- even bears make money but if you want all you lose all. pigs dont make any.

Monday, November 06, 2006

More Wars

a reliable source tells me that last friday, celtel decided to parade all their cars including those in the zindua promotion and the mobile care center. a show of might, richess and beauty. they even had a long haul truck full of lovely girls zangalewa commedians and blaring music. nothing wrong with that apart from the fact that they did their parade in front of the safaricom headquaters. they stoped there for a while and seemed to be dancing for safaricom. well we know that zindua was copied from nguruma, we also know that safaricom not only controls the phone market but is also the best company in EA and C africa if profits is anything to go by. celtel made a personal record of 60 million in profits last year. they may do better this year or worse. however street fights is not my idea of competition, i thought they would make their wars more based on pricing , value add and customer service instead.

stronger rumours are now coming in that sameers metorioric rise is stage managed as bridgstone exits completely from the tyre firm. that would explain it since i know someone who has been trying to sell his shares and they have not gone yet volumes are constantly high and the price is going up. his shares have been on the market for quite a while now. as for sasini its thought that the bonus share offer is doing them good. at least now we know.

stockskenya has made what would arguably be the clossest one can get to an efficient market. on their fantasy market, you can buy shares at yesterdays market price, any volume, and be sure to get them. you can also sell at yesterdays pricea anytime you want!

meanwhile investors have given Mr. Gitahi a dream welcome as the price has continued to go up. however maybe the market is just showing its lack of interest as it has done with ministerial appointments and even the issues at central bank. this is what keeps pessimists wondering if the NSE is real.

Odegle tip of the day
-- for better growth of earnings, reinvest your dividends and try to keep your percentage of shareholding in the company, ie when there is a rights issue, exercise your rights and do not sell your bonus issues.

Friday, November 03, 2006

The Bane of success

you never know about the downside of succes especially if it comes abruptly until you experience it. but what we are seeing in the NSE is exactly that. after the kengen IPO these guys have been so bombarded that they are failing to do just about every small thing that is expected of them. people are posting their own pricelists hours before they do and taking the credit, the website has not been updated with news and information for heaven knows how long and if you look at those of the brokers and investment banks you are left speechless. In fact the latter have been forced to recruit complete greenhorns and when you go to them, they may not even know how to extract your statements. its a sorry state. it reminds one of the days of congestion at safaricom after they execeeded their goals by over 1000% and recieved more subscribers than they had ever imagined. problem is the entry into the brokerage thing is prohibitive and elitist. so these guys are as safe as they can imagine.

Just wondering how the investors will react to the eveready IPO. will it really be oversubscribed? the thing that causes that is institutional investors. are there any of those who want to do the eveready business? if left entirely to retailers, then we may not see the repeat of kengen or scangroup. however scangroup was a very bad experience. tying money for so long only for you to be awarded 400 shares! worth 4000 bob! for speculators its ok but for the investors, Kenya RE and Mumias may be better bets.

banks great profits this year keep trickling in. the latest being KCB up 78%. KCB is a true testimony that one must not be judged on their past misdeeds. americans should know this. just the other day KCB was a no no. well now other things can be said. And even though i hate it, it appears that the sensational and screaming headlines of the east african standard is finaly paying dividends. the group has showed significant growth and profitability. on top of the bonus issue, they will be migrating to the main segment of trade early next year. at 68 bob a share, i suppose this would be one of the beauties of the election year. after all the only threat they have right now is 'muchuki' who may loose his fangs after elections next year. when it comes to news and analysis , KTN is head and shoulders above the rest. but i think the group should do something about their newspaper. it may just become a tabloid.

Meanwhile two merali firms are racing for skies and no one is saying why. a few people are throwing in better management, better profits and even the eveready IPO. most fund managers purposefully avoid merali, well why now. sameer has been having the hieghest turnover for 3 consecutive days each at improved prices. one investment advisor in a blog entry has suggested that its because of the surge in the number of tyres on our roads that has caused a dippinng share to turn around and sky rocket in one week!

i was comparing the prices of stocks between september and yesterday and the least i can say is that its nostaligic! EAC was 90 bob, icdc was 200 , sasini was 40, BBK 300 etc. just september. hindsight!

odegle tip of the day -- look before you leap, but for quick gains just leap. risk free life is a recipe for failure.

Wednesday, November 01, 2006

Hats Off ... Mr. Kiboro

The sun has finaly set on the ilustrious career of one Mr. Wilfred Kiboro. obviously in a class of his own, Mr. Kiboro strode the media industry during good times and bad ones never forgeting to wear his trade mark smile and his ease demeanor. however i remember the man more for his campaigns to have the air waves liberalised at the time when the govt was afraid of every shaking bush and every mooing cow. they would promptly start investigations at the sign of ripples in the pond! indeed the govt at the time did not want to venture beyond the unknown. but Kiboro bravely campaigned and got his way. he presided over the massive increase of share holder wealth and increased the groups revenues from a low of 1 billion to 6 billion. that on top of expanding the media house to our neighbours and increasing its products. more than that we saw his active involvement in social responsibility based on the premise noblese oblige. you could almost touch the passion and concern in his words every time he spoke about social needs and how corporates should respond. All in all i will always miss his ease and the fact that he did not have that 'CEO' look or important feel about him. that smile was very reasuring as well. i hope soon we start getting presidents who can hand over power the way he has done.

For Linus Gitahi, a huge responsibility to maintain the momentum and exceed expectations. it will definitely be a daunting task. another area he may quickly need to look at is the rumour that nation media staff are poorly compensated with quite poor working conditions. the rumour about tribalism with only a certain tribe favoured with senior management postions would also need quick fixing in order to see nation stem the certain surge in standard groups popularity and hence profitability. Gitahi must resist any attempts to make this group a govt mouthpeice since that is a sure death trap. at the end we will wait and see tomorrow how investors react to mr. Gitahi's appointment.

Kudos Mr. Kiboro and i wish you success in your next assignment.

Spoiling for a Fight

fresh from annoucing jaw droping profits hitherto unheard of in the EA and C region, safaricom is rearing to go at the banks market by introducing at a large scale money transfer. Money trasfer in kenya is probably one of the most lucrative virgin markets in kenya today. during a conference on cooperatives we were made to understand that the matatus that ply nairobi - nakuru route in most cases ferry money. people and even drivesrs are ready to risk ferrying at times as much as 500,000 in this way. in fact even at Akamba bus, Easy coach etc, most of the percels are actually money disguised. after EMS speedpost and telegraphic money orders from posta collapsed, there was no other safe and fast way to send or recieve money. by introducing this service , safaricom will be transforming itslef into a mini bank with pple having mini accounts at the dealers.

Be that as it may, following the success of both Naikuni and Adan, Mr. Etemesi has been appointed the CEO os stanchart a hopelessly foreign bank. am told even decisions to upgrade PC software have to come from abroad! lets hope that with the localisation of the kenyan leadership, those employees will be able to apply their brains now and not be merely robots.

and before the rain stops, sameer shall probably have traded another 10 million shares at an improved price of probably 25 bob. What is going on! how come there is very little disclosure on listed firms in Kenya. would the intended cross listing cause it this much exitment really? the tyre manufacuter has gained more than 50% in the last one week.

odegle tip of the day -- strategise , strategise, strategise and stick to the strategy even when ICDCI is tripling its share price in a single day!

Tuesday, October 31, 2006

Mr. May new casualty

I heard it in the grape vine over the weekend that Mr. Gerard May of Celtel has been shown the door. the great marketer who was head hunted from Cell C where he precided over a tremendous growth was told friday to take a walk and never turn back! its not clear if safaricom's unprecedented profit could have caused his woes or whether it was his decision to embarass the company with a copy paste promotion christened Zindua. why a company would want to do that kind of thing beats me. you decide to copy your competitors promotion word for word, what does it mean to your customers and observers? However inside sources say that celtel has always been difficult to market since all decisions must be made by amsterdam. they still treat africa as one homogenous entity and think like the IMF, world Bank et al that africa is a case of one suit fit all. so even after the marketing director has done his research and presented his strategy to amsterdam, he is told that the strategy does not fit the panafrican aproach and its shoved over.

When will the world learn that africans are as diverse as the fishes in the sea?! I dont think marketing strategy in Uganda would work in kenya, not even TZ and kenya are the same. what matters to us are completely different, even within kenya, the way you market yourself in the coast is not the same way you would do in Nyanza and so on. Celtel keeps failing since kenyans cannot identify with any of their adverts. those guys on the velo, the man with the kid etc are not kenyan. another thing is that Kenyans think very highly of themselves in comparison to other africans and bringing heavily accented western africans to market in Kenya is a complete no no.

where is the NSE heading? just the other day we feted the break of the 5000 mark and '94 record but yesterday the bourse gained another 71 points to settle at 5177, just the other day we were toasting the 660 billion market cpitalization but yesterday it was 766 and so on. i expected the market to dip as investors liquidate to rpepare for the kenya re and Mumias but it seems people are instead consolidating their positions. at this rate we may see 100B capitalization by year end. the main benficiaries will be yours truly the brokers.

finaly express has promised to post the bonus shares by 1st november. good news. i wonder what kind of management these guys have or what kept them so long.

this year has been the year for the financial stocks, last year we saw industrials show more flesh. who is going to strut the cat walk next year? services or will the industrials continue the show? i cant wait! i love this game

Odegle Tip of the Day -- its best to invest in a firm which you understand. Make sure you understand their business, their management, their shareholdings etc. Even their history and the industry in which they operate.

Sunday, October 29, 2006

Yoghurt, Chicken and Chips

Some time back when i was a teenager, my good friend Kodhek introduced me to a unique taste. i had visited him unexpectedly one evening and in desperate move to at least offer me something going by his Luo hospitality offered me roasted maize and home made sour milk. the taste was to say the least different , unique and shocking. However after partaking of my snack, i was hooked to that unique taste for ever. i could not get that kind of sour milk but to get close to it, i would simply buy yoghurt and roasted maize which was readily available. apart from the unique combination, that snack always reminded me of the simple brotherly love that Kodhek had for me and the sentimental hospitality that evening. my sisters have never understood how i can enjoy such an odd taste but i always remind them of that friend of mine

But while Kodhek introduced me to that great snack, no one prepared me for this, after moving up and down last saturday, i rushed to blue corner restaurant next to nakumatt. the speciality of the day? tandori chicken served with chips . so i went in and asked for the special of the day but lo! the special for the day was not availble that day. ok so i asked for kenchic chicken a kenyan speciality also proudly advertised as 'now available at blu corner'; no. kenchic is not availble today either. ok so what? grilled chicken and chips. on top of that i asked for a glass of vanilla milkshake. it took longer to prepare the milkshake but both the chicken and milkshake cost the same 250 bob each . the chicken was fine, but the 'milkshake' was actually sour milk or something close to that. no vanilla. when i complained, the manager said that all they need to do is add more ice to make it thicker. so they added a few more ice cubes! it became lighter and worse!

i wonder why someone would invest so much money on aesthetics and all those furniture and staff and yet fail to provide the core product. FOOD!

and that happened after another bad experience at another garage. i really dont like car mechanics. so to try and avoid them, i went to kengsway motors. looking at their aesthetics i thought i would get professional work there. but no. the mechanics were asking for 'something'. and for everything i asked for, they would ask if i wanted the 'muindi' spareparts or their own. their own cost half the price of the 'muindi' one at all times. meaning these guys are employed at the garage and yet they are running their own parallel garage using the facilities and time of the employer! And anyone thought kenya would grow out of corruption mire any time soon?

elswhere , NTV is set to go regional. this time not on the stock market but literaly. its showing yesterday by broacasting live to the 3 east african states was enough testimony of their ability. am sure after that will come the cross listing. another prime service company to buy. and speaking about the show, after i saw those performances and that great improvement, i wonder what those judges will do and we are not even into the second week. are those really ametures or is this another stage managed reality TV show?

KCC will list soon at the NSE. prepare for another oversupscription.

Does anyone know why there is a sudden surge in demand for sameer stocks? and the also the sudden rise in price? i would love to know. meanwhile i hope BBK will stick to their guns and be the first and only kenyan company to refuse the split and become the company for the real chosen few also known as investors.

Odegle tip of the day -- if you in the wrong train it does not help running in the oposite direction. disembark and take the correct train!

Friday, October 27, 2006

NSE Goes Berserk

So the good old prezo visited the NSE and caused the market untold excitement. after dragging its feet for about a month when the institutional investors deserted her, the index bounced back almost 60 points on seeing the president and another 100 the following day to break the psychological 5000 points mark. bullish signs came back in full swing and i know pessimistic fortune tellers must be adjusting their gogles and shifting in their chairs. they had predicted that the sweet lady had run the full marathon and would start to slow. But ng'o! on seeing the old man ...

and as rumours countinue , BBK shares climbs higher and higher. i still dont know why splits cause prices to go up. in any case they should come down since more shares are being introduced to dilute the market. now tell me at more than 500 /= and they havent droped the magic word yet. meanwhile their PE was good as was their management, earnings and potential. i saw that in SA the cost of anglo gold is almost 312 rand (3120 bob) by kenyan standards that would be split, split split!

But how about that guy who bought ICDCI at 800, how does it feel to see it come down to below 400 in less than a week. i heard one time of how a kenyan investor made 10,000 dollars in a day at the NYSE only for him to lose a similar amount the following day at the same bourse. i hope we wont see many such tears at the sweet NSE.

anyway if you dont like losing 10,000 dollars then you can run for 1.5 million KES on sunday during the stanchart marathon. probably one of those things you must do if you are kenyan. last year i learnt the hard way that kenyans are hard coded to run. even simple people who i see every day passed me as if i was standing. they didnt look anything like athletes but they zoomed past me with ease of a concord. what i remember is a marketing manager from coke cola. On seeing the massive presence of alpine coolers she almost lost the will to the marathon. the race was beeing beamed to millions of views all over the world. on top of that thousands turned up for the race. there were 12,000 racers to be precise and a bigger number of spectators. imagine the advertising potential all lost to a smaller company. alpine coolers!

Odegle Tip Of the Day -- Kippers -- Kids in parrents pockets erroding retirement savings. are you a kippers? beware of them. i read today about a nakuru man who has gone to court to prevent hs children from forcing him to distribute his wealth to them. the man claimed they had threatened to kill him. stupid kids. arent those kippers?

Thursday, October 26, 2006

Value of happiness

I dont know how diverse the readership of this blog is but i would really love to quantify happiness in monetary or financial terms. its often said that most winners of major marathons were at their best mood at the time of competition and am told a couple of record breakers actually made love to their partners just minutes before. but how true is that? does it mean that a person who buys beer for 150 bob in a pub where he is treated with absolute dignity and decorum would do better financialy than another person who scrumbles for the same beer at 65 bob in another pub? how does this translate to food, shoe polishing , choice of laundary etc?

However when that is disturbing me, service industries are raking in more profit than anybody else. top counters at the NSE are proving to be service oriented. isnt EABL service in toto and so is safaricom, KQ and the like. what does it mean; that kenyans are buying service more? meaning that they have more than they need ,further meaning that the economy is booming. well maybe that proves why refubishment of entertainment joints is the order of the day and FM stations are poping up like pop corn kila uchao

the best part of the news was however the proposal by the fin. minister that safaricom should be traded at the NSE before the telecoms bubble bursts. elsewhere its rumored that the firms CEO promised his employees that they would own part of the record breaker before the end of two years. still on rumours, that the NSE is bringing down the axe on all stocks trading at more than 200 /= since they are too expensive for the common mwananchi! so after the IPO festival there will be splits carnival. how is that for development.

odegle tip of the day -- Safari savings account from standard chartered bank is probably one of the best things since sliced bread. vis; no ledger fees, no atm cards (am told its called another terible mistake) , only 4 witdhrawals a year, 5% interest etc etc. you accumulate there and invest at the NSE four times in a year how is that for strategy!

Wednesday, October 25, 2006

Mumias Sugar Continues Shine

Going by media reports and mere observation, Mumias sugar continues in its shine after winning the bid to set up a mill for the Tana river sugar. the prospects are very good and the sugar cane is reported to mature in only 10 months at the coast as opposed to 18 months in western kenya. apart from that the world may be facing a sugar crisis of sorts as most millers turn to biofuel production and china mops up the only available sugar. it appears the consumers will be left crying but the investors in the top miller will be laughing all the way to the till. even better is the fact that the govt is going to divest more from the miller meaning that it will have govt support but no undue influence. my speculation is that if things go as planned then Mumias is about to do a KQ dance if not better. it may shortly join the likes of EABL, KQ and Safaricom as the top companies in Kenya. Verdict? Buy now.

But if that is true then this worries me. am told that farmers in the South Nyanza and its environs are normaly forced to destroy their crop because Sony sugar does not have the capacity or the will to crush their cane. in fact am told that jaggaries (sic) are doing a roaring business there since the farmers are desperate. Sony cannot crush your cane unless you are well connected so the jaggaries buy cheaply from them. the jaggaries are sold to molasses and sweets companies cheaply. cant we do the same thing we did with mumias so that kenya can gain from this one too?
Elsewhere Safaricom is set to announce what is poised to become the hieghest profit ever i east and central Africa. Phew! elbowing aside EABL and KQ and establishing itself as the voice of business in the region. Quite a feat in only 6 years. a lot of things have been said about the mobile service provider but i think their success has a lot to do with how they treat their dealers and employees. that safaricom employees are some of the best renumerated in the region is no secret. yet this is a very young company. only 6. and secondly they have a revenue sharing plan with the dealers. dealers are given lifetime commisions called residuals for selling safaricom lines. what it means is that if a dealer sells you a line , he earns a percentage of all the money you use to top up for as long as you live. How is that for motivation? However i always feel uneasy each time safaricom announces its results. reason? I dont own even fraction of that company. no kenyan does.

Be that as it may, i keep wondering why pple keep saying that when everready lists sameer africa share will go up. sameer africa does not own everready. i am aware that its sameer group which has shares in the battery manufacturer. Sameer Africa deals in tyres both imported and localy made. Sameer group is the holding company of Merali and there are many other companies under that banner including celtel. and by the way what is this about everready wanting to do and IPO and at the same time thinking of relocating to egypt. so they want to take our money and invest it elsewhere?

Meanwhile about 3000 Railways employees are about to face the sack as the transporter starts a new era. the employees are set to vacate the houses in 3 months time. i wonder what KR or RVR will do with the houses and the vast land they have. in fact i think RVR will have a lot or real estate to use or disuse. but i think their greatest asset may just be their history. the history of kenya and that of the railway are intertwined in fact for some of us we knew the only way to get to nairobi was by train since it was a very far off land. that added to the mystery of the cold heaven called Nairobi since pple going there could only go at night. apart from that they had loads and loads of stories to tell when they were back about their adventures in the train. i may be wrong but i think every kenyan has a relative or is close to someone who once worked for either KR or EARH

Odegle tip of the day -- if you are too faint hearted for the rollercoaster of the equities market, try out the relative comfort ride in the bonds and papers market

Monday, October 23, 2006

Wangari Maathai and the Stock Market

Its official. Wangari Maathai can help you beat the stock market! Well Wangari Maathai has never been known to be a stock market enthusiast. in fact now that she is in government of national unity she appears to in unfamiliar grounds. even her nobel prize was not feted much. but i digress.

a friend of mine has just told me how the great lady can help you beat the NSE fair and square. here is the deal. you get a piece of land or plot or shamba as the case may be. in a remote area that would be about 200,000 for an acre. you then approach Green Belt movement for a certain breed of trees which take just between 3 to 5 years to mature. assume you get 100 seedlings at 50 bob a piece. thats an investment of 205,000 in total. after they take root the trees will manage themselves so no more investment is required and there are no operational costs also no broker fees! if you sell those 100 trees at the current price of 10,000 a piece you get a cool 1,000,000 bob in 5 years or less! no sweat, no broker and no speculators. on top of that the shamba shall have appreciated by say 50 % so your total worth at the end is 1.3 million. another peace prize for the lady please.

Meanwhile this years Nobel Peace Prize went instead to a benvolent investor. the man who lends as low as $50 to the poor with only peer pressure and good manners as his collateral! the mans success is 99% in his guinea pig country. Mr Muhammad Yunus and his Grameen Bank's success is now being copied all over the world including Uganda. I thought equity was doing that too. hey give our guy credit too. but no equity is doing micro-banking but Yunus is doing micro-credit. i read that in the nation yesterday. Mr. Yunus says that his idea must not be tried by the faint hearted or the traditional bankers lest they die of worry and insomnia.

While that is happening, the project fame has been started proper. and yesterday saw the first 8 contestants sing their way into the house. i must say i was amazed by the talent i saw. i never thought we were that endowed. if you ask me all of them deserved to go in. the only difference was the choice of songs. those who chose nice and known songs easily made it. but i must say i cannot forget Renee and her rendition. but thats besides the point. what i find shocking or suprising is that this show which will be beamed to 90,000,000 viewers accross east africa and more elsewhere has attreacted very few advertisers. for instance non of the telcos are there, not celtel, not safaricom, not mtn or telkom kenya! i even thought the politician would use this marketers golden oportunity to market his presidential ambition. i suppose the show will be watched by over 60,000,000 youth in this vast market. millions will vote through sms and IVR. Well why am i complaining after all the winner stands to sell millions of copies of their songs. but the seasoned judge Ian Mbugua said the standard was not that good. well i understand the man who has done many fine things and many other fine plays. but these are ameuters (sic) who stand to be turned into millionaires in a matter of weeks. i hope some if not all or that money will find its way to the NSE.

Odegle tip of the day --Money can be made at the NSE. NO. A lot of money can be made at the NSE and a lot of money can also be lost at the NSE.

Thursday, October 19, 2006

another share split

So does it not begin to take shape? my earlier speculation that more shares would be picked, hyped and split? now ICDCI has annouced a share split to make the share affordable to the retail investors. there are strong rumours that the same is being planned for KPLC as well. what i dont agree with is that at 300 bob a share would be deemed expensive. i remember that eabl anouced the split when it was 500 and even then their split was 1:5. this one is 1:10 yet the price is only 300. and how come BBK has never found their share expensive enough to warrant a split? so now the time before the split is almost 3 months. what will happen this time? only speculation will tell.

and while that is happening the season of great give aways and promotions has just come. with yana giving a million, EABL with the merc, safaricom, coke you name it. its promotion galore. the festive season is being ushered in as traditionaly as it goes.

And what is that thing on KBC? the one where they encourage people to call and create words ? you are then required to guess some numbers and then voila ! you can win upto 100,000 /= i think thats not a promotion. its not even a lottery since these guys simply refuse to pick the calls waiting for as many people to call as posible since they are cahrging 50 bob above normal rates. then at the end that gril shouts hallo to one last caller. the girl keeps pretending that all along no one was calling. i dont see how this is different from pyramid schemes.

odegle tip of the day -- a put option gives the buyer the right but not the obligation to sell a certain number of shares at a set price in the agreed future. investors benefit from put options in case the share price goes down. i havent seen it in kenya though.

Wednesday, October 18, 2006

Marketing Kenya

I just read that the chairman of Kenya rugby association or whatever it is has submitted 'our' bid to host the next sevens world cup. they are competing with 7 other countries. the chairman complained that the government is not giving much thought towards supporting the bid. that they dont see the potential of what this can bring to the country in terms of tourism and boosting foreign exchange. Well that may be true. however i have been wondering; many people are complaining that the govt isnt doing much to market the country or to support most social activities and sports. i heard the KFF people complain, the organizer of miss kenya, volyball etc. they say that in other countries these disciplines are doing very well.

Well i think that if we are to wait for the govt to market and support these disciplines we will get no where. the issue lies with our marketers. i think sports pays well in western countries mostly because of marketers. they use sportsmen and women as their billboards and pay them hansomely. i therefore feel that the people who should be blamed are marketers for failing to see oportunity and exploit it to the advantage of both them and the sportsmen and women. they should be able to see how they will benefit if harambee stars becomes a household name or if more kenyans go out to watch rugby or volyball. or how they will benefit from the beauty shows and so on. in this regard the marketers are the ones who have failed and so i suggest that all our marketers whould be lined up and shot then we can get new herbal multi active marketers with powerform plus!

bloggers are suggesting that since there is a shortage of cement, the price of ARM, Bamburi and EAPC should go up immediately! and when thats happening manufactures are saying that the traders are hoarding cement. meanwhile Sudan and Rwanda has huge orders for the same commodity from the country.

Most people have a very simple question; buy or sell? most brokers have a very simple answer; buy or sell!

Wanted ; a broker with a fully functioning online trading. updated website and customer service.

odegle tip of the day -- selling short means selling borrowed shares now with a agreemnet to buy them later within a specified time. short sellers gain when the stock price comes down within that specified period. i have always wanted to be able to do this. however most brokers i have inquired from only tell me about borrowing money from CFC or cooperative bank against my shares. then they hold the shares as collateral. well that doesnt qualify as a short sale to me.

Tuesday, October 17, 2006

Business of Death

For my MBA i wanted to do a paper on the Business of War. this was inspired by a report on the activities of CARE in North Eastern. the report was given very candidly by a field officer working there and who had also been to somalia and experieced first hand the attrocities visited on those people. but my paper was to dwell more on the business of CARE and others in their league as opposed to the war itself. however my paper could not be done since i didnt have the money to do it. the logisitcs were a nightmare. i had wanted to use southern sudan as my population but i did not want to use secondary data. Indeed war is big business and one time i will still want to do a paper on it.

however the other day i was brought home by my friend who is senior officer at AMREF about the business of Death. what goes on and why it cant stop. He started by saying that DDT will probably not see the light of day or it will be hugely opposed. reason? Malaria is big business! indeed he made me see the light. picture this; those nets that are normally distributed for free or at a subsidized rate are bought even before manufacture. every thing is paid for by 'donnors'. where will they take their businesses. think of the shareholders, the supply chain, the banks who lend the money etc. who will allow malaria to be eradicated? my friend even told me that most doctors and small clinics in nyanza and western and other malaria prone areas survive solely on malaria treatment. remove that disease and their business would go down by a massive 80%!

further he directed my attention to ARVs, manufacture, research, logistics, shipments etc. thats a whole industry that would collapse in fact the world economy would be greatly affected. so according to him HIV probably has a cure already but no one will accept it. since decision makers are making huge sums of money from it. i was made to remember margret as well. she who earned a fortune for chairing a task force on HIV. would she want the disease eradicated? how many are there out there like her? how about those millions of HIV/AIDS NGOs?

in fact those so called donnors are actualy clearing houses. they are not themselves owners of the money. so once such diseases are eradicated they too lose their raison d'etre.

i am reliably told that US used DDT to eradicate malaria (not very sure though) but they quickly realised that for their drug industries to survive, they needed the killer disease in africa and other developing nations. thank God they always had rulers in africa who did not think much of their people or who were not sharp enough to see beyond their noses. leaders who thought they would not only rule forever but also live forever!

indeed i was made to understand that in amref, all suppliers must be american or you lose your job. another shocking thing was that some american NGO give AID in form of corn which the beneficiaries have to sell themselves and turn into money to be used for their activities. wow!

what is most disheartening is that africa responds by sending some of their most brilliant sons to america to wash their behinds and do their dishes. infact they willingly invest millions of dollars in this excercise of self enslavement.

apperently there is a lull of intitutional investor activity at the bourse and that is the reason for the share prices and volumes going down heavily in the near past. i would think that most people are preparing for the IPOs and the Mumias sale. another strong rumour is going on that express has won a tender to do all the logistics for EABL. this rumour has been there since last year. in fact another suggests that EABL removed 40% of their business from express. but express has refused to give people their bonuses almost 4 months down the line. is CMA alive or dead? I have read somewhere that midlands plans to sell their shares through private placement at 10/= . did i see that right? the par value is 5 and according to suntra the true value is 28 bob. would be a good deal in that case.

and when thats happening , mumias has won the tender to be the strategic partner in the TARDA sugar project. quite refreshing that a kenya company has shown both the teeth and muscle to do this instead of some western or eastern country. how many times will this happen before the govt decides that safaricom can be bought and run successfully by kenyans through the NSE?

small investors were serious about the Nisa i talked about some time back. in fact they held the first meeting last week. stock brokers be very afraid!

odegle tip of 3 days Private placement means that a firm does not offer the its shares to the general public (read retail investors) but rather to a few institutions and fund managers

Thursday, October 12, 2006

Kosewe Success

yesterdays edition of Money matters brilliantly told us how Mr. Osewe famous for the kosewe dishes, has beaten the NSE. well am guessing he did. since we are told he started with less than a shilling some 30 years ago. today the man is a household name and he attracts not only kenyans with his ugali and witty humour but also tourists. in fact when a consultant came to our offices the other day and asked specifically for kenyan food, i couldnt think of a better place than ronalo foods. It was refreshing to see the man on telly and hear his story again. Am sure after yesterday, more kenyans will open 'osewe' dens all over the city and expect a return in a week. how about an IPO of ronalo foods? it would be oversubscribed!

Actually when money matters started i thought these were the kind of stories they were going to feature and not stories about how multinationals have made decisions abroad and imported to kenya. in another blog i suggested that but readers werent happy with me. I think Kenya stands a chance only if we keep getting kenyan solutions to kenyans circumstances

Elsewhere the bullish trend at the NSE is not relenting, even at this time when investors are taking profits and the prices are going down, volumes traded suggest that those who missed out earlier are taking stronger positions and holding on to them. in fact twice in a week the turnover hit or passed the 1Billion mark. the index is approaching the 5000 point from a low of about 2500 only 4 years ago this time not based on infaltion but real activity and increase in the number of invetors and speculators (i heard a politicaly correct name is traders)

some blog which believes that nothing good can come from 'Nazareth' has suggested that the liquidity at the NSE has nothing to do with the economy being good but rather that the money is from questionable sources. it in fact is money laundering by highly placed govt operatives. i almost belived him but then i thought about the other 'fundamentals' like increase of the number of investors, the cash ratio requirement of commercial banks, increased awareness, improved profitability in most sectors of the economy (sorry) and so and decided to continue investing at the NSE.

I loved how Murigu of Suntra said that the market LOVESspeculators!

Tribalism is a bad thing. no its a very very bad thing! and thats why during the good old presidents days our radio stations could not play 'tribal' songs. read songs in vernacular. i always wondered why we could play lingala and other southern african songs on national radio. we ended up promoting those cultures and upto now there are some zairois who live in kenya on music alone while our own artists live in squalor. another blog is going on and on about tribalism in kenya. but i love the way some enterprsing kenyans have taken advantage of tribalism to beat the NSE. i am thinking of royal media, kameme, KBC , panafric hotels and even carnivore. well thats not new since politicians have made money for a long time by simply using tribalism.

odegle tip of the day - great investors see oportunity in every situation.

Monday, October 09, 2006

Mumias Sugar Company

i have just read a very favorable analysis on Mumias sugar. the author is however very modest and in the disclaimer said that his research should not be the only one used to make a decision to invest. i however think that to say the truth MSC is currently quite a good buy. the best thing to do at this time would be to accumulate as much as posible in order to make the most out of it.

Banks have reportedly decided to lower their interest rates in the midst excess liquidity in the market. some from a high of 21% to a low of 14%. however thats still not good enough. i also still feel that the moeny contimues to be risky given that it is financing consumption only. its time banks became more aggressive and gave more meaningful loans. for a middle income guy, i think the 1.3 million banks are toasting is kidogo. coz for a guy earning 150K monthly, i suppose he would do good things with say 2.5 to 3.5 millions. and of course given the laon is payable in 60 months.

odegle tip of the day - if you are young, you better take the risk and invest direclty in the stock market else once you grow too old you will have to be careful and probably only entrust your money to the care of fund managers

Friday, October 06, 2006

Value of Money

My friend who has been a bank manager in kenya is relocating. the guy has just hit a jackpot! he will be resigning his job which nets him a paltry 100K a month since he has already got a college admision in US. getting a visa wont be a problem since he has been working for a bank and knows his way around. in the US job oportunities will be many and he will literaly pick money from the trees. on my side we have made a brilliant arrangement to invest for him the extra change at the Nairobi Stock Exchange. i will definitely use some of the 'investor advice' available on the net for free. mainly from the blogs. after 5 years i think the guy can then come back and live in fabulous luxury all his life.

so now in the final quarter of the year 2006. the stocks are showing some laxity. the bull is getting tired and the bear may be lacking in the corner. but that may not entirely be true since our market slows down at this time when traders take profits. the new peak is often Dec. however this time it will be a little unpredictable given that the market is gearing for the Mumias sale and the Kenya Re IPO. some counters will definitely go down as investors sell to get money to invest in those two. the same happened just before kengen.

odegle tip of the day - contrarian investors normally buy undervalued stocks when everyone else is selling. they always do their homework thoroughly. most contrarians are never in a hurry

Get rich quick

A colleague in the office has just given me a presentation on a new fast effective and proven way out my misery and poverty. its a novel investment vehicle that works miracles to say the least. all i have to do is buy a form from him . the form costs 2500. i then sell 5 forms to 5 other people. who also do the same and so on. on every child form., my name moves up and i make 500 or so as i move. any way in short i end up earning about 4 million when i reach the apex. now 2500 is little moeny to invest so i figure i can just start with 10,000 that gives me 4 revenue streams and a pay day of about 18 million in the end which as he says i get to determine. so i can choose to get this end in 1 month. With such innovative and easy ways to make money who needs the stock market?

you and your money - a common saying in the work circles suggests that for you to have job security, you must be cheap. the firm must have a feeling that they are getting more than they bargained for. meaning that you must be earning less than what you are worth. i met this old guy smtime back and he said a similar thing when it comes to personal finances. he was quite elderly but he appeared too happy to be real. but he said his secret has always been having financial security at all times even after retirement. how did he do that? He lived below his means. that means that he always had more than he needed at any given time. he drove a practical car, wore relevant clothes, never borrowed for consumption etc. now that is something the credit card companies would not want to hear. they want you to live beyond your means for that is what keeps them in business!

Thursday, October 05, 2006

Oil Oil Oil!

it can easily be said that in todays world oil is the most death provoking substance known to man. apart from the business wars between the oil magnates of US (read Bush) and those of the oil rich east, many people have died in zimbabwe, nigeria and the like due to lack of transportation etc. basicaly oil shortage. oil long overcame gold as a reason for men to pick a querrel. planners have however argued that in the near future wars will not be about oil or gold or such things nice but just about water and water sources. but i digress

yesterday, the good minister said that he was watching the oil cartels to see if they will reduce the pump prices now that the crude oil has come down. well i dont expect them to drop. not when Bush is still the prefect of the world. I think bush's leadership is a case of a huge conflict of interest but that is another story. i suppose that kenya can only be protected from the crude oil price movements if we adopted what most countries do. 1. have a good backup of oil. good reserves. its important to have reserves that can last at least 5 years. this way we could delay the effects of sudden price surges. i get embarrassed to see pump prices go up just because of a standoff between bush and his business patners (read terrorists). we cannot afford in kenya to be that reactive. its good to be planned, to anticipate and be ready.

2. the other way is to 'divest' from oil like brazil and south africa are doing. reduce our dependence as much as we can. in kenya even some of our elec is generated using oil products.

I hope this time the south africans will have both the gut and the money to take over the railways system they won. i hope there will be no more postponment. the solution to our road transport system lies in railway trasport system. it will help remove those heavy trucks from the road and ease the preasure. congestion should be dealt with as well as incessant road patches. i also cant wait to enjoy soft confortable and secure rides around kenya not forgeting enjoying the breathtaking scenary. problem is southern african countries always fail in kenya.

what did you feel when the minister announced that KPLC will continue to pay the low tarrif for power from kengen. is that really good for biashara? so KPLC can be as inefficient as they want since they are protected by the govt and are allowed to buy cheap and sell dearly? but does anyone else see the hand of trancentury in all this? after all they are the current 'owners' of KPLC as well as the ones running the govt? in fact there is a very strong rumour out they that KPLC is being fast tracked for a split. that explains the price surges in the recent past. transcentury have a history of hyping stocks for a split. (EAC) whether there was good stead or not. by the way, KPLC is the major customer of EAC. KPLC buys from kengen. trancentury owns EAC and KPLC and by politics kengen . do the math. if you a speculator and need to tripple your money fast. buy KPLC while stocks last!

odegle tip of the day -- sheep are those investors who do not know where they are going or what they are doing. they rely on others to give them direction and tell them what /when to buy/sell. they never make their own decisions.

Wednesday, October 04, 2006

Bank Charges

yesterday i got a shock from CFC bank. on checking my current account , i found they had deducted close to 3K. they explanation; 1. they cahrge 500 if the account goes below 10K,2. they charge 500 maintenance, 3 . they have 1K penalty incase it goes below 0! how about the other 1K? i dont know and they couldnt explain. well those things were not told to me when the account was being sold to me. in fact i didnt know that a current account is expected to have a minimum balance! i have current accounts with std and bbk and they dont have a minimum balance. i thought a current account is a business acnt so how is it expected to have a minimum balance. beats me. and the so they deducted their charges and that sent to acount to below 0. then they conviniently charged 1k since they had made it go below 0 how nice!

while that was happening, some guys from NIC came to us with a proposal for our club . 1. no minimum balance 2. no charges whatsoever only the individual checks to members to be charged at 75 bob per transaction 3. debit software so we can directly debit members acnts instead of using checks etc. the two banks operate in the same kenya country

another conference opened in nairobi. this time for cooperatives. the minister who is also the VP said -as expected- that saccos suffer from mismanagement since they have no set standards. thats sounds cliche. i alsways feel that our leaders dont talk to us. i always feel like they recite to us.

saccos are good but i think its almost a kenyan thing that most pple who go for elective office do not even have an agenda. they get elected sacco bosses but they have nothing in their mind that they want to do with that office. invariably they get corrupt since in kenya where you work is where you eat!

i met a salesman from one of the leading stock brokers houses. he said they have a fund similar in fact to zimele. its called secumat. it looks like secumat is the second leading shareholder of EAC. with secumat he said, you just pay 250K entry fees, then they invest your money for you at their descretion. he promised that you would get all the money they make. i didnt believe him. but at least he hinted that they are aware that EAC is an empty drum and that they enjoyed the hype and money they made with the split.

Odegle tip of the day -- when people are buying and buying and buying be afraid. be very afraid!

Tuesday, October 03, 2006

Nairobi trade fair

Yesterday monday i was invited to go and judge the exhibitions at the Nairobi trade fair. we were a number of judges and the theme was ; "Empowering people through growth in agribusiness" quite a mouthful. Well as expected most stands were not ready and when going in you could still hear the hammers and smell the paint. the theme was a little off if you ask me and for their part the american govt stand had seeds! the juakali stand was full of clothes (does jua kali only mean clothes?) however there was also a 'mural' of 'banana' leaders against a background of bananas. great talent wasted in worshiping politicians. However the juakali stand also had a very inovative
well-drill. the man said he can drill upto 500 feet and 6 inches wide. the machine cost only 750,000. the other commercial drillers charge upwards of 1million just to drill.

the other stands were prety much the same story, same exhibitors, same color. in fact most of the paitings were being hang from the nail holes of yesteryear.
I saw in the catlle stand a dairy cow going for 65,000. the attendant said the said cow was heavy with child and once it gave birth, it would give upwards of 40 litres of milk a day. if you sell that at 20 bob a litre, then you could beat the stock market any time!

the prisons band played a rendition of Tony Nyadundo's hit song 'Sanda gi Hera'. they made some very lovely formations. is this band commercial, or is it only wasted on politicians? going by their creativity, am sure they can make some tidy sums of money if they went commercial. played jazz etc.

if you look at it though, the show was generally low quality, i kept on wondering what the target audience was. for a fair which has existed for 86 years, i was expecting some spectacular stands, exhibitions and shows. i think sarit centre has stollen all the thunder from this ground and since at sarit the quality is very high, i suppose most firms are opting for maximum returns by going for the sarit shows or the ones at KICC. in fact some judges suggested that the ASK should be sold at the nairobi stock exchange now that there IPO is the bizzword.

in a number of blogs, pple are debating whether to buy MSC now, or wait for the govt to sell at a discount. some advisors are telling pple to sell what you have now, then wait to buy from the govt when they sell the extra 18% at a discount. another told people that Mumias cannot fulfill their EU quota for sugar hence is a bad buy. yet another is telling people to sell because the price is droping etc.

what i know is given the restructuring, the venture into alcohol, th generation of electricity (34 MW) and the selling of their kyoto quota to japan, the low price, Mumias is the company of the moment.

Odegle tip of the day -- I have learnt that before deciding on the firm to buy, find out whether you truly understand their business, their management style, their goals, their ownership , their industry, thier future, their competition. if all that is acceptable to you. then its safe to invest.