Publication date: January 24, 2024 01:11 (EAT)
A trader looks at charts while working on the floor of the New York Stock Exchange, July 8, 2014.Reuters
The decline in the value of the Nairobi Stock Exchange presents significant opportunities for investors to re-enter different market segments and broaden their portfolios.
According to market experts, the volatility seen on stock exchanges in 2023 will be a unique opportunity for both retail and institutional investors looking to take advantage of stock discounts in the market ahead of an expected bull market. It is said to be an opportunity.
“If you look broadly, Kenya is the cheapest it has ever been in the 15-year-old data we have, three standard deviations away from the average, which is extreme and this is almost a black swan-like situation. It's an event. There's a lot of value in Kenya and there's a lot of value in Kenya, not just in comparison to our African peers, but also to our peers, where Kenya has performed extremely poorly,” said EFG Hermes Head of Kenya Equity. said Muati Kilonzo.
But where should investors focus when most counters are performing roughly the same?
According to market analysts, 2024 will be an opportunity for investments in the agricultural sector, with financial counters expected to improve and recover.
Safaricom's entry into the Ethiopian market is also expected to bring in considerable revenue for the telecom giant.
“I see opportunities in the banking sector, especially the equity group. I am also bullish on NCBA Group and I&M due to their strong value proposition in agriculture. We're very optimistic because of the value.'' Revenues are growing at triple digits. ” Ronny Chokaa, Senior Research Analyst at Aib-Axys said:
“On the insurance side, we like not only Jubilee but also CIC, we like the long-term insurance exposure, and Jubilee has leadership on the medical side that we think will drive profitability. We are bullish on Bamburi on the construction front.”
Muati Kilonzo, head of Kenya equities at EFG Hermès, said of Safaricoms' potential. “It’s interesting because Safaricom demystifies Ethiopia and they brought investors to Ethiopia in February. I think management is doing a lot of work to open people's eyes about one thing. Globally, most telecom markets still have over 100 million people using 2G. there is no.”
The Nairobi Exchange experienced significant volatility in 2023, with its market capitalization rising from a high of SEK 64.8 billion in March on the back of the Diageo tender offer to a low of SEK 6.6 billion as of December 2023 on sales. It fluctuated.
