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The East African : March 24th 2014
60 MARCH 22-28,2014 BUSINESS, MARKETS AND FINANCIAL ANALYSIS THE MARKET WHISPERER EQUITY MARKETS (WEEKLY CHANGE IN BENCHMARK INDEX) NSE 20 Share Index Kenya 4971.74 -0.24% (CUMULATIVE MOVEMENT) DSE All Share Index Tanzania 1,962.54 0.68% USE All Share Index Uganda 1,475.86 -0.95% RSE All Share Index Rwanda 146.04 0.09% JSE All Share Index South Africa 46,508.27 0.68% NGSE All Share Index 37601.74 Nigeria - -0.83% fate of Malaysia Airlines’ Flight 370, Kenya Airways is busy. And there would seem to be KQ lands special bi≥d, sea≥ches fo≥ boss E ven as the world of global aviation is riveted on the no shortage of action from the denizens of Embakasi, to the East of Nairobi where KQ is based. The city will be keenly watching the search for a replacement for long-serving CEO Titus Naikuni. The University of Nairobi- trained mechanical engineer is finally exiting the corner office at KQ after an eventful 10-year stint, having joined from the trona-rich dust bowl of Magadi Soda. Enter Jambojet It will be interesting to see whether the head-hunters will settle for in-house talent or search further afield. In any case, while it is true that no Kenyan has CEO-level experience in running an airline of KQ’s stature, Mr Naikuni has shown that this may not be a necessary pre-requisite for the job after all. Then there is the high-stakes experiment with a budget airline. A past rendition of the model did not fly. Flamingo off, its managers will be keenly aware of a graveyard bursting at the seams with similar ventures that could not gain height and stay the course. The animation at KQ does not end there. Next month, the region’s largest airline takes delivery of a special bird, the first of nine. The 787-8 Dreamliner is about three years late in coming, thanks to hitches involving some of its parts, but KQ believes it was worth the wait. “The Dreamliner can fly from Nairobi to Paris and Beijing non-stop and therefore brings superior operational cost performance while carrying more passengers and cargo to further distances,” says Mr Naikuni. Attracted by its fuel efficien- The 787-8 Dreamliner is about three years late in coming, thanks to hitches involving some of its parts, but KQ believes it was worth the wait. was forced to crash-land, a fate one hopes Jambojet, which takes off this Thursday, will avoid. An advertising campaign, promising fares as low as Ksh2,850 ($32.40), has captured the imagination of a market hungering for affordable local flights. But even as Jambojet takes Right, CEO Titus Naikuni at a media briefing last year. His term in office has expired Picture: File cy and capacity, KQ ordered nine 787-8 Dreamliners in 2006. The birds are part of the firm’s 10-year fleet modernisationplan to up the fleet from 40 to 86 by 2023. Given its capacity — it can carry 210-250 passengers on flight ranges of between 14,20015,200 kilometres— the aircraft is likely to be used on KQ’s longhaul flights to Europe, Asia, Far and Middle East. Wo≥ld Bank splashes $73m on DRC powe≥ plant RARELY DO good things come the way of Democratic Republic of Congo these days. But the World Bank has approved a $73.1 million grant to fund the Inga 3 Basse Chute (BC) and midsize Hydropower Development projects in the conflict-torn country. The funding, together with the $33.4 million approved by the African Development Bank late last year, is expected to boost DRC to develop its large hydropower potential, estimated to be the third largest in the world after China and Russia. It is estimated that less than 10 per cent of Congo’s 65 million people have access to electricity. The funding is good news for a country whose economy is being threatened by conflict in the rebels-ridden eastern Congo.With the potential for 40,000MW, Inga is the world’s largest hydropower site. With an estimated generation cost of $0.03/kWh, it also is one of the most affordable sources of energy in Africa. The 100MW produced by the Inga 3 BC is to be sold to the national utility SNEL, which in turn would sell it to households and small businesses in greater Kinshasa. The increase in power generation corresponds to the projected unmet demand growth in Kinshasa by 2025. This significant additional energy access for households and small businesses could only be financed and developed by combining it with electricity sales to credit-worthy business and other regional users. It is proposed that 1,300 MW of power would be sold to mining companies in DRC’s Katanga Province and an additional 2,500 MW to South Africa. At the same time, the mid-size hydropower projects would help to increase energy access for people living in the rest of DRC. Published at Nation Centre, Kimathi Street, and Printed at Mombasa Road, Nairobi by Nation Media Group, Box 49010, GPO Nairobi, 00100. Registered at the GPO as a newspaper. Nairobi Office, Tel: 3288000, 211448, 337710, Fax 214531, 213936. Dar es Salaam Office. Tel: 2119657/8. Kampala Office, Tel: 232771, 232772. Fax 232781 Download free QR Readers from the web and scan this QR (Quick Response) code with your smart phone for pictures, videos and more stories Uganda’s DFCU issues bonus sha≥es THE LESS available a resource is, the more likely you are to overpay for it. Ask DFCU, the Ugandan securities exchange listed bank’s shareholders. The company’s share price has risen by about 20 per cent since the start of the year on thin margins and speculative demand. Since January, says an analyst at Crested Securities, the counter has traded 1.728 million shares, representing a mere 1.74 per cent of the company’s free float. The analyst says the trend over the past year has been largely supported by the potential growth of the company and the illiquidity of its shares on the market. The market is also driven by a proposal by the company’s Board of Directors to issue bonus shares in the ratio of 1:1. The proposed bonus issue is al- so likely to improve on the liquidity of the counter and is expected to lead to better price discovery. Profit after tax grew by 13.01 per cent to Ush34.6 billion ($13.71 million) from Ush30.62 ($12.13 million) in the financial year ended December 2012.
March 17th 2014
March 31st 2014