Safari into the Rally of 2021's Top Stock on the NSE.
Nairobi Business Ventures, the shoe vendor, turned cement manufacturer that is topping racing charts on investor returns on the Nairobi bourse.
Picture this, the year is 2016, Kenya’s parliament has just adopted bill capping interest rates to no more than 4% above the central bank’s rate. Your good friend is constantly singing about how he picked up Safaricom during the IPO with funds from a loan, prices of the shares have tripled and they’re set to join the millionaires’ club.
Your good credit score earn you a loan from the bank, you freeze, your broker gives you an enticing option, a new listing that’s coming in on the market, a shoe maker set to list via introduction, calls it a good local company and is quite convincing that returns may come in very soon.
You take your risks:
Nairobi Business Ventures.
Nairobi Business ventures [NBV], a then shoe maker, listed on the Nairobi Securities Exchange at Kes 5.00 per share. The company gave up only 30.46% shareholding to the public. At listing, the shares of the K-Shoe brand start tanking, slowly but sure falling below the deep sustainability line. Most investors who invested in NBV during this period might have tried to salvage as much as they could, playing the bigger fool.
The Pit Stop
Investors who held the share since then, almost lost hope when in October 2020 when the company announced deep business restructuring with an aim of looking beyond the NSE for funds to steady their businesses and was subsequently suspended from trading.
Three months down the line, and four and a half years after listing, there is hope! The share came back with a bang and picks a rally!
+1290% - How much NBV has rallied in year on year.
+94.86% - How much NBV has rallied since the year began.
+61.00 - NBV share price rally in the past one month.
1st - The rank NBV currently holds in terms of investor returns on the Nairobi Securities Exchange.
So, why the rally? - During the restructuring process in 2020, NBV concluded a Kes 83 million buyout deal by a Dubai-based company known as Delta International FZE. Delta’s main aim on NBV was to move it from a shoe maker to a cement manufacturing company. The shift in business most likely has raised investors appetite for the stock, backed by various economic data on the cement industry.
With this, despite the losses that NBV has posted in the past years, investors seem to have their convincing share and want to get their bets moving.
Our Verdict - Long range bull’s eye shot for investors who bought NBV at listing date in 2016. The big question however remains, just how far can this bull chant the run?
Here are our cowries for the week
Nairobi Business Ventures - Topping the weekly charts isn’t easy and so this week, we will continue monitoring NBV as the share continues to rally on the Exchange. Major views will be to seek for possible break out points in the event the share price experiences a market correction.
Nation Media Group - Yeah, back again to our sea ways, we will be collecting cowries from NMG who’s shareholders approved the share buyback plan and will officially begin the activity this Monday. NMG’s share buyback was set for Kes 25.00 per share and the company closed the week at Kes 23.05 per share.
Microsoft Corporation - Microsoft became the second U.S listed company to hit $2.0 Trillion in market capitalization. The company also launched windows 11. Bill Gates is definitely having a great view! Microsoft has been seen as one of the top stable (blue-chip) companies with returns on the Nasdaq with a +65% shareholder returns since the beginning of March last year.
Big question though, do you think Bill Gates uses an iPhone?
The next update of the Hisa App will be including global stocks and you can also buy into Microsoft, so worry no more.