Kausha wrote:@cnn the price is up there because all their capacity projects are on course for delivery within target times. They started grinding in Dar - 750,000 tonnes late last year. The 1.2m tonnes Tanga Clinker plant and 750k tonnes Tanga grinding plant comes onstream in October 2013. Their Kenyan capacity is about 960k tonnes per annum. In other words in 2014 this company should be twice the size it is now and investors are pricing that in. Margins in tanzania and 10 percentage points higher than kenya and uganda.
The 750,000 tonne cement grinding plant in Dar es Salaam was commissioned in October 2012 and sales from this additional capacity were reflected in the higher 1H 2013 revenues. The impact of the grinding plant on revenue is lesser than expected but will be watching this going forward. … The 1.2m tonne clinker plant in Tanga will be commissioned in 1Q14 meaning its impact on cost saving from ceasing importation of clinker will be felt next year. …. company is highly leveraged and there is the ghost of convertible debt leading to dilution. …. All this and more considered, &IMHO, the share price is still overvalued