Safaricom has a unique advantage over new entrants. With M-pesa service becoming the norm as far as payments are concerned,we should see more growth in data revenues. Given the dealership support and the banks joining the cue,it will continue to be a major payment system going forward.
As far as the 1st half results were concerned it was notable that the the company is banking on data to fuel future revenue growth. Operating Profit was up a marginal 3.4% and PB4 Tax was up only 1.7%.
Going by the way the maket has taken the news,it seems that during these tough economic times,static revenues are a welcome and the expectation is that improvement on the bottom line will be maintained once the economy gets back on track.
EPS improved by 8%. Assuming the price stays on at 5/= and results follow the same pattern by year end and the EPS gets to about 0.34 we will see a PE ratio of 14.88. Give the sector PE ratio of >20,I will expect the price to stabilize on or about KES6.70.
Time is money, so money is time. Money saved is time gained in reverse! Money stores your life’s energy. You expend your energy, get paid money, and store that money for a future purchase made in a currency.