Rank: Chief Joined: 8/4/2010 Posts: 8,977
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mwekez@ji wrote:@e_kijana (post 379 and 380), the rights issue + offer was in Nov-Dec 2010. The money is reflecting in the 2010 and 2011 results. It was applied as follows:
*Investment in banks FDR in 2010 – KES 705,390,000
*Investment in government securities in 2010 – KES 238,127,000
*Investment in government securities in 2011 – KES 1,383,726,000
As at end of FY 2011, they had 2.76 Billion in FDRs and 2.47 Billion in Government securities (held to maturity). Their 2 greatest investments!!! I saw that too and wondered was it hindsight or sheer luck. The fact that they also don't hold equities unlike the other insurance firms also saved their skin last year as the NSE nose-dived.
The P/E is a bit expensive compared to its peers, but I like the growth momentum. If maintained, Mr Market shouldn't have issues with it. E.g. EABL P/E is in the 20's in this market!
However I wonder if it can sustain a huge rally going by the huge share volume it brings. It'll be very liquid and the share price will be equally volatile. Good thing saccos will be long term holders. Since Mr Market has been partying with insurance stocks of late, I expect on listing the share to spike up and sustain the bid.$15/barrel oil... The commodities lehman moment arrives as well as Sovereign debt volcano!
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