Closing Bell: Uchumi Rebounds To Close Above Rights Issue Price
Uchumi Supermarkets Limited (UCHM) was the top gainer at the Nairobi Securities Exchange (NSE). It ended the day at KES 9.20, up 9.52% from yesterday's close of KES 8.40. This was 20 cents higher than its rights issue price of KES 9.00.
Before the AGM that Uchumi CEO Jonathan Ciano had said that certain ‘faceless investors’ were responsible for the drop in the retailer's share price. Indicating that they were deliberately pushing the market down in an attempt to probably force a takeover. During Wednesday's AGM Mr Ciano revealed that a collapsed loan deal with an undisclosed foreign bank is what forced Uchumi to turn to Cooperative Bank (COOP) for a KES 500 million asset financing deal. The subsequent delay is what caused Uchumi to delay paying its suppliers.
Read: Closing Bell: Uchumi The Biggest Mover At The NSE
At the AGM the company chose to retain its rights issue price. This was despite Uchumi's share trading at 8.20 then.
In the run up to yesterday when Uchumi traded at a low of KES 8.00, the sentiment was that its price had bottomed out. From there Uchumi could only rise.
Uchumi rebounded 6.5% yesterday to close at KES 8.50, but still below its rights issue price of KES 9.00. For anyone looking to enter the East African market, the entry point does not get more bargain basement than this, which is a P/E of 5.9 and a market capitalisation of $25.12 million. Aly-Khan Satchu of Rich Management wrote on Thursday.
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Uchumi's share price performance in recent times[/caption]
The winners:
The other top gainers were: Home Afrika Limited (HAFR), Williamson Tea Kenya Limited (WTK), Mumias Sugar Company Limited (MSC), and Standard Group Limited (SGL). Each closed at KES 4.35, 300.00, 1.55 and 36.50 respectively.
The losers:
The counters that shed the most value were: Kenya Airways Limited (KQ), Car & General Kenya Limited (C&G), BOC Kenya Limited (BOC), Unga Group Limited (UNGA), and East African Portland Cement Company Limited (PORT). They ended the day at KES 8.00, 55.50, 140.00, 38.25 and 58.00 respectively.
Market snapshot
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As at 3.10 pm today. (Market Close)[/caption]
Most shares traded:
Safaricom Limited (SCOM), Mumias Sugar, Flame Tree Group Holdings Limited (FTGH), Equity Bank Limited (EQTY), and Kenya Commercial Bank Limited (KCB). Over 6 million Safaricom shares changed hands today representing 27.9% of all shares traded.
