sparkly wrote:Aguytrying wrote:VituVingiSana wrote:@Aguy - I like TPS. Bought some at 36. I should pick some more up. Solid management. Nice P/B. If they were to sell it as a going concern, they could easily find buyers. Lots of re-development potential for Nairobi Serena.
My buy price is also very high coz I started a long time ago. I want to take advantage of the depressed price at normal strength, eps is 3-4. Right now eps is bad due to poor results but I expect this to change. As you said good management the industry is a problem but I'm betting it will get better.
Got some this year at 24-25.50. My average buy is now 28.60. TPS is 16% of my portfolio but will be adding some soon to make it 20%.
Kengen, Kenya Re, Equity and KK also doing well in my portfolio.
The other laggard is CFC Stanbic which i failed to dispose at 130-140.
TPS failed to expand in Nairobi e.g. Westlands where Sankara/Kempinski dominate & Upper Hill with Crowne Plaza. Many people do not want to stay in or near 'town' nor hold events at Serena when more convenient options are available in Upper Hill and Westlands.
A Serena Westlands and Serena Upper Hill (or Hurlingham) would have helped consolidate their grip.
Another overlooked segment is a "Serena Lite" which would cater for those who want cheaper but quality accommodation. Look at Fairview with its full service main hotel and (limited service) City Lodge.
And despite the obvious demand it has no Airport Hotel like Panari, Eka, Ole Sereni, etc.
Such a strategy helps Serena spread its Back Office, Reservations & Fixed Cost expenses across more rooms. Plus these properties can act as training schools for the premium brands [or the other way round].
That said, I like that Serena has kept expenses/debt in check when times were tough. A judicious expansion strategy helps with the slow but sure approach when quality needs to be maintained.
KQ grew too fast. Took on too much debt. Disaster.
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett