@Sparks we agree though I am of the opinion you are seriously discounting certain earnings drivers. The GP margin they have is from inventory management. Trading at the right time and holding logical quantities. KK also starts the year minus 460m loss from tz and Lubumbashi. Forex valuations are at a net profit. KK is repaying debt aggressively from TX sales but from higher cash flows due to higher profit margins.

There are alot of businesses KK can diversify on to slightly delink from its core oil businesses. They must think now that they want to plant their own offices. I wish they could reward those who suggested the best options to them.

KenolKobil diversifies business operations to survive low prices

Please share the math because we are heading there.

What I really like now is the beginning of renovation of stations to attract rents of restaurants, which in turn will also increase retail fuel sales. That will increase turnover and profits.
People who think that the profits are just from cost cutting and paying down debt will be surprised.

This share in two years time will be trading at between 15/= and 20/=. You can't gurantee anything in the stock market but this will be as close to a gurantee as you can get. Provided the good running of the company prevails. People should be accumulating.

Data gleaned from Kestrel and SIB reports after the investor briefing. Ceteris Paribus.

2016 forecasted EPS 1.65
Debt at zero by 30 June 2016 [unless there's an acquisition]
Forex Losses will be minimal with UGX & KES stabilized.
KPRL tanks to be renovated for use as storage so supply will be better.
Real estate enhancement [rental income]
New stations in Kenya - Breakeven in 3-6 months
200,000 LPG tanks on the way.
K-Card is better and faster.

Let's take the 1.65 EPS so at 10/- that's 6x PER. The assets are carried at cost in their books and they have realized that some 'CBD' stations are worth a lot more as rental properties. Will they sell these? I do not know.

Is KK a takeover target? Yes [I say] but Ohana said they do not run KK to sell [that's for the shareholders] but as a PROFITABLE GOING CONCERN for the future.

My take:

2016 1.65
2017 2.00

2018 CETERIS PARIBUS I think KK will be acquired. Hence I am very comfortable adding KK at 10/- for 18/- in 2018 assuming a normalized 10 PER.