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KenolKobil, KPLC or KCB?
Rank: Elder Joined: 9/29/2006 Posts: 2,570
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cnn wrote:@guru,explain what you mean by margins being hit.On the issue of rising crude, as has been said before,the monthly adjustments as per the ERC formula will take care of that at the pump. @Guru. As you ponder over @cnn's querry, why is KCB "mis-behaving"? The opposite of courage is not cowardice, it's conformity.
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Rank: Elder Joined: 1/21/2010 Posts: 6,675 Location: Nairobi
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cnn wrote:@guru,explain what you mean by margins being hit.On the issue of rising crude, as has been said before,the monthly adjustments as per the ERC formula will take care of that at the pump. the monthly adjustment of 1 shilling when crude has risen $10 just doesnt cut it... Besides 2010 profits were made when crude was at $85 and pump prices were 100bob Now tell me if they'll match that with crude at $100 and pump prices at 95.6bob Mark 12:29
Deuteronomy 4:16
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Rank: Veteran Joined: 6/17/2009 Posts: 1,621
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@guru,the details and dynamics of the fuel control formula and the various fuel components contributions to the oil marketers business pre and post controls have been detailed on other threads,i will not go back to that.On the 100 dollar crude wait until the products purchased at that price hit the pumps and we will discuss that 95.6 then.
I have two dates with KK ,in April and August and i remain supremely confident.
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Rank: Elder Joined: 1/21/2010 Posts: 6,675 Location: Nairobi
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cnn wrote:@guru,the details and dynamics of the fuel control formula and the various fuel components contributions to the oil marketers business pre and post controls have been detailed on other threads,i will not go back to that.On the 100 dollar crude wait until the products purchased at that price hit the pumps and we will discuss that 95.6 then.
I have two dates with KK ,in April and August and i remain supremely confident. @cnn this the point I'm trying to make... KK will announce stellar profit growth for the year 2010.. This will drive up the share price temporarily until june... There is absolutely no evidence to show that they will come to the same profit figure in 2011 and this should make the share underperform for the full year of 2011 Mark 12:29
Deuteronomy 4:16
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Rank: Elder Joined: 1/21/2010 Posts: 6,675 Location: Nairobi
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jerry wrote:
@Guru. As you ponder over @cnn's querry, why is KCB "mis-behaving"?
@jerry you will not believe the amount of resistance KCB has at the 24 level... Infact it is sooo much so that speculators will not touch the stock until it touches 25bob and a rally is in full force.... If one is VERY patient you can get in now because kcb has been valued using many metrics at around 32bob... But if you are looking for quick gains wait for 25bob then ride with it until 32 Mark 12:29
Deuteronomy 4:16
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Rank: Veteran Joined: 6/17/2009 Posts: 1,621
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@guru,the August date is for KK half year,an early pointer to full year 2011.The same controls vs profitability scenario refers and the oil majors will beat 2010 though the growth will be lower than 2010.For KK add the regional growth.The industry has its possible shocks which could alter the prospects,but KK remains my call.
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Rank: Elder Joined: 7/22/2009 Posts: 7,568
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Bettertry wrote:jerry wrote:They managed a dividend of KES 0.325 in 2009. What can we expect in results for last yr? Correction, dividend for FY09 was Ksh 3.25 and not as u posted!!! @Butterfly - @Jerry factored in the split! Oh how nice it would be to have a share worth Kshs. 10/= paying me a dividend of Kshs. 3.25/=! Never count on making a good sale. Have the purchase price be so attractive that even a mediocre sale gives good returns.
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Rank: Elder Joined: 9/29/2006 Posts: 2,570
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@MaichBlack, Thanx. @Guru;Since my break even for KCB is 25/= I need not do anything. Thanks for your encouraging analysis/observations. @cnn; we are together on KK at least up to April. The opposite of courage is not cowardice, it's conformity.
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Rank: Chief Joined: 1/3/2007 Posts: 18,223 Location: Nairobi
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guru267 wrote:KK in Kenya will not survive coming oil shocks...
KPLC and KCB will do it for you I disagree. KK will suffer but GoK/Kenyans will suffer even more coz KK will not make losses just to sell fuel. Plus KK has a great 'export' market... I wonder how GoK/ERC will tackle the high fuel/oil prices [now above $92/bbl] when the next 'increase' happens in 2 weeks! Bottomline: Small importers/independents will suffer more [except if they DON'T pay taxes/VAT/levies]. That means KK can gain greater market share of PROFITABLE sales! GoK quietly allowed OMCs to import fuels OUTSIDE of OTS as there is a looming shortage of Diesel. Also KRA got involved. Bottomline: KK will use its PRIVATE FACILITIES to import for (more profitable) Export markets... The local market will be served/dedicated for sales through OTS imports... Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Elder Joined: 9/25/2009 Posts: 4,534 Location: Windhoek/Nairobbery
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KK is great stock to own, look at its Pan African drive...Segman and Co will never let KK down although sometimes they have risked too much...KK can only make losses if oil prices crash to 50 US$ per barrel...i dont see that happening unless we have another recession, if that happens which stock will not be affected.
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Rank: Member Joined: 1/29/2011 Posts: 257
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@all: loving the discussion  . Two things though: 1. does anyone know what the current status of KK litigation is, and the possible effects that this litigation could have on future profitability (and, of course, share prices)? I'm inclined to believe that this has partly influenced the current stagnant share price. 2. not much has been said of the 3rd K, KPLC; does the recently concluded rights issue not augur well for share prices in the immediate future? "All intelligent investing is value investing -- acquiring more than you are paying for. You must value the business in order to value the stock." - Charlie Munger.
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Rank: Chief Joined: 1/3/2007 Posts: 18,223 Location: Nairobi
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@the deal - KK would prefer oil at $50 since it means financing costs go down + greater comsumption levels coz lower prices! Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Elder Joined: 1/21/2010 Posts: 6,675 Location: Nairobi
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@VVS, @the deal bottom line is that KK will announce lower profits for 2011 in August which will send the share price lower... Mark my words.... Mark 12:29
Deuteronomy 4:16
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Rank: Chief Joined: 1/3/2007 Posts: 18,223 Location: Nairobi
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guru267 wrote:@VVS, @the deal bottom line is that KK will announce lower profits for 2011 in August which will send the share price lower...
Mark my words.... Unlike @qw... I am sure you will keep your word if we bet...! 1) I am not disputing KK will have lower 1H 2011 profits against 1H 2010 in Kenya due to due to Price Caps in Kenya + fluctuating Crude/Fuel prices. 2) I believe KK's regional strategy will pay off. 3)KK will emerge stronger in Kenya as others collapse UNLESS there is a massive scam allowing 'connected' firms to avoid taxes, etc. Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: New-farer Joined: 6/3/2010 Posts: 96
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KK, is my do or die portion of my portfolio...its one of those shares in a unique position of having limited downsides (partially mitigated by its low EPS and respectable dividend yield) and potentially limitless upside based on the fact that oil is now nearly as essential to day to day life as air. Coupled with a dynamic mgt (compared to the other oil major), it stands them great benefit
but do agree....it may take a dip post 1st half results announcement...but do not see it dipping below avg of shs 9 when got in, (assuming it rallies post mar to appox 12-13 then it can only drop to the shs 10 range)
KCB is the other major portion of my portfolio (avg 21) however intend to drop out once it passes 25...the share is too stagnant and mgt team does not inspire a lot of dynamism and market response, but they are in a sweet spot as regarding their S&L business which is now under attack but BBK, Stanchart and even coop.
Really worried about the Mckinsey involvement in KCB, have worked with them extensively on a number of projects and they are only as good as the direction they get from the top...not sure the large KCB mgt team is aligned enough to give crystal clear directions to MCkinsey in which case the 2 yr project will probably costs over $5m-$10m and will only result in mangled staff morale and no impact on sustainable
Culture plays a big role in any business and the culture of KCB is not as entrepreneurial as say Coop or equity...and Mckinsey will not solve this. If the board was really serious, they would make a once in a lifetime offer for Muriuki to jump ship and steer the big ship going forward. he has done a remarkable job at coop and has the right skill set to run a locally owned bank.
Just my 2 cents
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Rank: Elder Joined: 10/13/2009 Posts: 1,950 Location: in kenya
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guru267 wrote:
the monthly adjustment of 1 shilling when crude has risen $10 just doesnt cut it... Besides 2010 profits were made when crude was at $85 and pump prices were 100bob
Now tell me if they'll match that with crude at $100 and pump prices at 95.6bob
if we were to work with the above figures then per liter of crude the marketers would be buying it @Ksh 68/= P.L therefore if they were to maintain The current price of ksh 95/=P.L it would leave ksh 27/= P.L to cater for refining,transportation and other over heads. We know maintaining the current pump prices will not be possible if the crude prices continue to soar, therefore KK will continue making profits as long as the use of the formula is adhered to. '......to the acknowledgment of the mystery of God, and of the Father, and of Christ; 3 In whom are hid all the treasures of wisdom and knowledge.' Colossians 2:2-3
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Rank: Elder Joined: 9/29/2006 Posts: 2,570
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@Papacito! I have some KCB shares but I've also never been confortable/confident with it(KCB). There is a Dep M.D. to Oduor who was once at Coop. The opposite of courage is not cowardice, it's conformity.
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Rank: Member Joined: 12/15/2010 Posts: 162
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KCB is set to break the KES.24 resistance level and move all the way to its correct valuation of KES 30+ in the near term.
Note the following.
1. Full Year Financial Results are just about to be released. (they will definitely be impressive)
2. KCB has the largest asset book among the banks in the region (note that banks' cash cow is asset book)
3. The bank has a presence in the Kenya, Southern Sudan, Uganda, Tanzania and Rwanda. (that SS will yield alot in 2011)
4. The bank has over 215 BRANCHES (good branch network to sell it products including the S&L mortgage)
5. The MCkinsey consultations are good news to a shareholders ears. Efficiency is key in an organisation's performance.
6. KCB has great prospects in 2011
Take the current opportunity to buy enough shares
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Rank: Elder Joined: 9/29/2006 Posts: 2,570
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@invest0r. Thanks for those encouraging points. The opposite of courage is not cowardice, it's conformity.
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Rank: Elder Joined: 12/9/2009 Posts: 6,592 Location: Nairobi
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invest0r wrote:KCB is set to break the KES.24 resistance level and move all the way to its correct valuation of KES 30+ in the near term. It sure has broken the Kes.24 resistance level, now at Kes.22 
BBI will solve it :)
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