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
entrepik - Nonsense... wacha those conspiracy theories.
ReplyDeleteThe government should get the HIGHEST possible price to benefit 33 Million Kenyans not just 330,000 who buy shares.
The minimum is 200 shares (9,900/-) to make it "affordable" to the guy in Mazeras, Bunyala, Kibera, etc. Below that amount is uneconomical.
Capitalism - You don't like it, don't buy it...
For those who DON'T want to apply for the OFS shares - fear of oversubscription- can always buy from the market like you say but I like the 10% discount (though I wanted 20%)...
Odegle, I must confess that I have never taken a bank loan and dread to do so. Though I may be interested in the near future, what are the 'hidden terms and conditions'?
ReplyDeleteI read somewhere in blogworld that Mumias separates the Speculator from the real investor. Dont know how true but with the company's growth strategy,feel its a must buy,better than the Eveready.
ReplyDeleteFor those complaining,look at its Pe and Dividend yield.
there are high possibilities that mumias wil be barely fully subscribed coz guys aren't ready to put in cash and yet Thew price is not expected to hit 70/= in the near future (70/= would be 40% returns. The last 2 ipos have returned 300%+). If that happens, it may dampen interest for Kengen OFS Which is expected next and also safcom, kenya RE
ReplyDeletejakarumba - Every bank is different. Also they can't print everything in an ad so u have to soma the legal lugha.
ReplyDeletehc - Current P/E is 19 (coz 3/- EPS)... Dividend yield is also low. The question is FUTURE GROWTH?
Gathinga - Its an OFS (yaani, govt is selling its shares) & not IPO. No funds go to MSC for further development.
I expect heavy interest from Institutional Investors on the last day after they know "how many" shares they can expect.
Barely oversubscribed but not a problem coz all parties benefit i.e. govt gets the cash, investors get the shares & few annoying refunds.
i think you will agree with me that kenyans are really really price sensitive! to say the truth, eveready at 9 bob is more expensive than mumias at 100 bob. how do you determine whether a share is too expensive or not? remember , what yu are getting into is an investment. you are buying an asset. in financial terms an asset is something which is able to bring to you future benefits.so for instance if you buy a house and live in it. its not counted as an asset since it wont be bringing you any monetary benefits. on the same breadth a TV is not as asset as so on. the more potential that asset has the more valuable it becomes. if you plce MSC and eveready or even scangroup on the same scale, MSC would win hands down if you look at the posibilities of future benefits. as for institutional investors, they dont like tying their money too early in the offer period. they will probably be buying towards the end of the period. why buy now when the thing takes 2 weeks? again if you ask me, 4 bob really makes a big diff. remember govt is divesting from the firm, that means that there will be less undue political interference and hence professionalism will thrive. hence the potential is great. i have said it before and i say it again: oversupscription does not lead to post offer price appreciation! only if those investors potray continued interest does the price head north!
ReplyDeletejakarumba; i dont have the details but there was an asterix on the advert. one condition however is that you must have those premium accounts. now when you have prestige, you minimum bank charges per month with BBK comes to about 2750 if you have two standing orders. that comes to 33,000 a year. so you wil be paying the loan charges in other ways. maybe i should do another blog post on banks and hidden charges!
Sure Odegle, do a post on bank charges especially now that am considering Stanchart.
ReplyDeleteI was in Barclays on on Tuesfday and decided to ask for details on their buquet tarriffs, to me its a raw deal compared to Stanchart's flat tariff of Ksh. 750.