You are using very big words my bro/sis. Please explain what you mean by liquidity risk. Do you mean that Kengen will not be able to meet financial obligations when due? Is this assertion supported by an adverse cash flow statement?

Single buyer model risk - I assume you mean that Kengen sells to KP only. Would you rather Kengen start distributing its own power?

I agree with @murchr and @sparkly above and yes most people don't seem to understand how this firm works. See the below link on how Kengen operates, how it makes it money, it's future plans, MDs commentary on the share price, rights etc and other queries discussed in this thread under the links below

ati how many birrions do they want !ehhhh! ambitions nazo

Kengen Debt to equity ratio is currently at.79% which is high.Thats why the stock has been very volatile since listing in 2006.Return to equity is low at 8.1%But the dividend yield is ipressive at 8%.The beneficiaries pf this stock are speculators and short term investors

True but that does not eliminate liquidity risk and the single buyer model risk. Their liquidity is not impressive. You are better off lending to kengen than being an equity holder.[/quote]

You are using very big words my bro/sis. Please explain what you mean by liquidity risk. Do you mean that Kengen will not be able to meet financial obligations when due? Is this assertion supported by an adverse cash flow statement?

Single buyer model risk - I assume you mean that Kengen sells to KP only. Would you rather Kengen start distributing its own power?
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So many ppl dont understand the partnership btn KEGN and KPLC. KPLC will buy KEGNs power at all times. Its work is to generate. How it will get to KPLC is the responsibility of a govt institution called KETRACCO. Any losses incurred in transmission is not KEGNs problem. Any losses incurred while distributing power is KPLCs loss, any forex losses are incurred by KPLC who in the end passes the loss to Wanjiku. So KEGNs income is almost certain. Am I not getting something on this liquidity issue? If you have a guaranteed customer, whats the risk?
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Forward P/E doesn't look attractive. The massive dilution due to number of shares. I like the governance of KenGen and feel it's a good stock for long term investment

@city mayor,i want to enter at a very low price due to its volatile nature.To hold it for long term.Is there chance that it will trade below the rights issue price?

@spikes let's be positive please.

After the rights issue KENGEN will now start its real price discovery after trading below it for about 5 years when plans of the current rights issue were announced.

Fear mongering...we will wait and see

@Ebenyo based on the tripling of share capital through the rights issue, you can basically divide FY 2016 expected earning by 3 to see what worth you will be having for a single share depending on what price you decide to get in. The golden rule is to trigger fundamentally and enter or exit technically. My math is abit rusty and I welcome any criticism from the community. Assuming a generous expected FY2016 EPS of 7.20 based on the HY 2015 EPS of 2.58, this would translate to an EPS of 2.40 after factoring in the rights shares, or a 54% drop in EPS yoy. The question you should ask yourself is how much you are will to pay for that amount of earning which many investors would differ broadly based on what we call the PE ratio. It is currently trading at a trailing PE of 1.35