By John Gachiri
Carbacid’s
market value has jumped by a quarter in only two weeks following a
split of the gas maker’s stock, raising by tens of millions the paper
wealth of top shareholders.
In addition to becoming more liquid following the
share split, Carbacid’s share price surge has also been driven by a
dividend payout and bonus issue.
Carbacid’s market capitalisation stood at Sh10.45
billion at the close of Thursday’s trading from Sh7.85 billion mid this
month when the split was effected, raising shareholders wealth by Sh2.69
billion.
Analysts said increased liquidity after the
five-for-one share split has attracted institutional buyers to the
Carbacid stock, which has pushed the share price up.
“The improved liquidity may have brought it into the fund manager’s range,” said market analysts at ABC Capital.
The five-for-one share split increased the number of shares to169.9 million from 33.9 million.
Prior to the share split the company also announced a Sh3 dividend.
The gas maker closed at Sh61.50 on Thursday but
touched a 52-week high of Sh62 in intra-day trading, having moved 34,000
shares.
Former cabinet minister Maina Wanjigi and
billionaire businessman Baloobhai Patel are some of the listed firm’s
biggest shareholders.
The company’s net profit grew to Sh475.5 million
in the year to July compared to Sh389.2 million a year earlier, a 22 per
cent increase but it maintained dividend payout at three shillings per
share.
The firm’s sales however remained flat during the
period at Sh952.8 million, a pointer that the profit growth was mainly
driven by cost cutting.
Foreign investors
Carbacid produces and supplies pressurised carbon
dioxide and dry ice, and has in recent years posted double-digit growth
in sales including last year when its revenues rose 60 per cent.
Demand for CO2 has mainly come from food and beverage firms such as EABL, Coca-Cola, and flavoured juice makers who use the commodity as a preservative.
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