Kenya Power Gains in Longest Rally Since March: Nairobi MoverKenya Power Ltd., the East African nation’s sole electricity distributor, recorded its longest win streak in six months as investors looked for a haven amid concern that a tax increase will dent other companies’ profit.
The stock climbed 2.4 percent to 15 shillings by the close in Nairobi, a fourth day of gains and the highest level since June 21. About 2 times the three-month average volume of shares were traded.
Kenya’s expanded value-added tax came into effect on Sept. 2, broadening the range of goods the tariff is imposed on at a standardized rate of 16 percent. Kenya Power is the second-best performer this month on the FTSE NSE Kenya 25 Share Index. Kenya Electricity Generating Corp., known as KenGen, has rallied 6 days to a gain of 4 percent this month.
“In the case of Kenya Power and KenGen those are utilities and so people need their services,” Eric Munywoki, a research analyst at Nairobi-based Old Mutual Securities Ltd., said in a phone interview today. “Consumer companies will experience an adverse effect because incomes remain at the same level and consumers’ purchasing power is eroded.”
Kenya’s 25-Share Index rose 26 percent this year, with KenGen the second-best performer, adding 90 percent. Kenya Power has dropped 12 percent since the start of the year.