AIB-AXYS Research Updates

As promised, this week we begin our lessons on the four key ratios every investor should know when picking stocks. Today's term of the week: The P/E Ratio To determine if the P/E ratio is 'high' or 'low,' compare it to the ratios of similar companies in the same industry.

Today’s Highlights ▪️ CEO bonuses of top NSE firms dip to Sh735 million Chief executive officers (CEOs) of the 10 largest firms listed on the Nairobi Securities Exchange (NSE) took a Sh82 million hit on their collective annual bonuses in 2023, as shareholder returns in the form of dividends declined amid flat profits. ▪️ Win for travellers as limit on untaxed personal items up The minimum value of personal effects that passengers can bring into Kenya without being taxed has been raised fourfold to $2,000 (Sh259,477) from $500 (Sh64,887.31), handing a major relief for thousands of travelers long inconvenienced by product seizures by tax officials. ▪️ Manufacturing posts largest loans slump of Sh39 billion Kenya’s manufacturing sector has taken the biggest hit from private sector credit slowdown occasioned by high commercial bank lending rates and rising non- performing loans. ▪️ Equity narrows gap with Safaricom in profits race Visit any country in the region, and chances are that among the first signs of Kenyan presence you will spot is the green of Safaricom’s M-Pesa agent shop or the maroon of Equity Group’s bank branch. Equity Bank and M-Pesa, a popular mobile money transfer service, are increasingly rivalling tea and flowers as Kenya’s leading exports. ▪️ Bamburi’s stock gains 28 percent on buyout offer from TZ company Bamburi’s share price gained 28.3 percent yesterday to close at Sh57.75 in response to a disclosure that the company had received a buyout offer at a premium of Sh65 per share from Tanzanian conglomerate Amsons Group. A total of 17,100 shares changed hands at a range of between Sh49.6 and Sh60-which is still below the buyout price. ▪️ KRA nets Sh43.9bn in revenue from tax Amnesty The Kenya Revenue Authority (KRA) netted Sh43.9 billion from its just-concluded tax amnesty programme, which ran from September to June 30, narrowly missing its Sh50 billion target from the window.

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NOTICE OF INTENTION TO ACQUIRE UPTO 100% OF THE ORDINARY SHARES OF BAMBURI CEMENT PLC. Amsons Industries (T) via its Kenyan investment vehicle Amsons Industries (K) has issued a notice with the intention to acquire upto 100% of the ordinary shares of Bamburi Cement Plc for a cash consideration of KES 65.00 per share. The Offer Document to be released later will include a timetable for the offer, according to which shareholders of Bamburi will be able to accept the Offer within 30 days of the Offer Document, or such longer period as may be approved by the Capital Markets Authority. The anticipated special dividend following the completed divestment of Bamburi's shareholding in Hima Cement shall be payable to all shareholders of Bamburi on record on the record date indicated in the Special Dividend announcement and shall not be for the account of the Offeror. If the Offeror achieves acceptances of 75% or more of the Offer shares, the Offeror may then, subject to approval from the CMA, apply for Bamburi to be de-listed from the NSE.

Attend a webinar on how to build wealth with core stocks on the Nairobi Securities Exchange. Date: 18th July 2024 Time: 7:00PM Link: https://bit.ly/3XTnR98

Today’s Highlights ▪️ Kenya’s domestic debt jumps by Sh577 billion in a year Public debt in the local market grew 5.8 percent during the fiscal year that ended last month with new borrowings hitting Sh577 billion, up from Sh545.2 billion acquired in a similar period the previous year. Fresh data from the Central Bank of Kenya (CBK) shows the new borrowing took the country’s domestic debt stock to Sh5.41 trillion as at the end of June 2024, up from Sh4.832 trillion at the end of June last year. ▪️ Tanzania-based Amsons makes Sh23bn Bamburi buyout offer A Tanzania-based conglomerate with diverse interests in energy, construction, food and transport has made a Sh65 per share bid to fully acquire Bamburi Cement for a total of Sh23.5 billion, representing a 44.4 percent premium on the target’s closing stock price of Sh45 yesterday. ▪️ Eurobond yields fall, shilling steady amid downgrade Interest rates on Kenya’s issued Eurobonds have fallen while the exchange rate remains unchanged, signalling market calm amid the sovereign credit rating downgrade, which has been feared to raise the country’s risk profile in domestic and international markets. ▪️ How diesel cargo sparked fresh Kenya-Uganda fallout An undeclared consignment of 17,000 cubic metres of diesel shipped to Mombasa by Vitol Bahrain on behalf of Uganda triggered the latest standoff between Kampala and Nairobi, official correspondence show, with Kenya reacting by imposing a bond fee on the disputed cargo. ▪️ Red flag as Youth Fund bad loans hit Sh2.5bn The Youth Enterprise Fund (YEF) has accumulated Sh2.5 billion loans which have not been serviced for more than three years, signalling financial strains on the revolving fund created to help youth-owned enterprises access lowcost credit. ▪️ Property fund Fahari starts restricted trading Property fund ILAM Fahari I-Reit has begun trading on the Nairobi Securities Exchange’s unquoted securities platform, bringing the firm back to the bourse on a restricted market after its delisting from the main investment segment in February.