According to NSE CEO Peter Mwangi, the NSE has plans to list SMEs in a mid-cap market segment by end of Q2 this year. They are targeting companies in the Ksh 17M-Ksh 1B in value. Preferably the top 100 mid-sized companies. What are the the market sentiments? Are we ready to jump on this bus? and waht does this mean for the main market segment?

http://www.abndigital.co...ed-interviews/212497.htm

Many firms need the Equity for growth without the imposition of restrictions of debt... Some could be making losses but have a good plan...

I will judge on a case by case basis.
@VVS that true but their are other ways of raising capital that doesn't involve the scrutiny public firms have to go through. Private investors, angel investors venture capitalist etc also bring knowledge, expertise and influence that can assist firms grow.

The private investors, more often then not, plan as an exit strategy to sell shares on the exchange. If you aim and ambition is to list this crucial growth phase is critical to actualize good returns on your investments and hard work.

@dkuyoh looking at the top 100 year to year it is very variable. So what happens to the top 100 do they move on to be large enterprises or do there performances just drop??

There is no blanket advice you can give about SME in kenya and if they are to be listed i will look at them on a case by case basis!

The success of some SME is not based on the ability of the business model but on personality and ability of the owner to bring in business.
Example circuit business systems (Number 79 in 2010 and 68 in 2009). The company sells computer and used to be an exclusive supplier of compaq computers from the late 90s. I am not sure if this progressed into HP or not.
The company grew rapidly making loads of money for the proprietor. He was supplying business and governments with computers and servers and servicing the machines.
Currently he has competition from every dick tom and harry who can import comps and or assemble comps.
The proprietor a mr owino was shrewd and smart enough to diversify his newly acquired wealth in agribusiness, real estate and commercial properties.
He is doing well for himself but why would i want to buy into his company? What business model is he employing. What happens when he leaves or loses control? How can he expand his model into EA?
How raised capital through venture capitalist but i think he paid off or bought back control and now has full control of the company.

Why would he sell? why would he want people looking through his books?

That said of the SME top 100 in the years 2010& 2009 companies whose books i would love to look at if they were to list.

Pentapharm: Retail business with several outlets. Margins on drugs are 30% but to bulk buyers such as insurance companies around 10-20% mark up on the buying price. Can reduce cost by hiring pharm techs and supervising pharmacist. Capital input will help with economies of scale and can even lead into manufacture of some compounds. On a side note I think stock master might be one of the 5 proprietors of pentapharm!

Tononoka rolling mills, Sheffield steel, impala glass. They have huge potential and are potential ARMs. Capital input can help in expansion into EA.

deepa industries, manji foods, crown foos, kenya sweets: FMCG producers. listing can attract loyalty similar to uchumi and safcom sychophants. Have opportunity to expand in EA. capital input will help in growth equipment, economies of scale etc etc!

KAPS limited: No particular reason other than curiosity.

Not interested in any cellphone retailer, marketing company, or branding company! Volatile industries with dominant players and i just don't understand what makes marketing companies tick other than the personalities that started them. I don't understand what capital input will help with in these companies.

@ts Nakumatt??

In America they have NASDAQ which serves the same purpose.(trading of companies that dont qualify to go into NYSE). I think the NSE due diligence procedures wont fail to notice some of the discrepancies that you have noted. true the risk appetite is higher but so will the returns the market can reflect the intrinsic value of the companies

Microsoft & Intel started off on NASDAQ... & stayed...

“Progress in the financial
world is based on savings,”
Dr Chandaria said. “The business of speculation is very addictive. If you go to
the casino once you always want to go back, ” said the renowned businessman. www.businessdailyafrica....66/-/rwxa0y/-/index.html

Chandaria's conglomerate is a family business so i highly doubt he'll be interested in putting it up to public scrutiny. we may have another AK debacle where the family run everything from sweeping the corridor to peddling their IT solutions

Actually, no debacle coz seems they don't want to go public...