Jubilee stock hits Sh500 mark as market cap rises 75pc

Money Markets

An investor at the Nairobi Securities Exchange monitors trade at the exchange office in Nairobi. Jubilee Holdings closed October 1, 2014 trading at a new all-time high of Sh489 per share. PHOTO | FILE  NATION MEDIA GROUP

By CHARLES MWANIKI, cmwaniki@ke.nationmedia.com

In Summary

• Jubilee has gained 75 per cent this year, taking its market capitalisation to Sh29.3 billion from Sh16.8 billion in January.
• Jubilee is trading ex-dividend on a Sh1 interim offer for which books closed on September 19 with payment due on Monday next week.
• Only BAT and Limuru Tea have traded at the Sh500 mark and above in recent times.

Jubilee Holdings share touched the Sh500 mark in Wednesday’s trading at the Nairobi Securities Exchange, becoming only the third counter to trade at that level this year.

Jubilee closed at a new all-time high of Sh489 per share having touched a trading high of Sh500. Only BAT and Limuru Tea have traded at the Sh500 mark and above in recent times.

Jubilee is trading ex-dividend on a Sh1 interim offer for which books closed on September 19 with payment due on Monday next week.

In the half-year to June the composite underwriter grew net profit by 35.6 per cent to Sh1 billion compared to a similar period in 2013, helped by an increase in gross premiums by 28.5 per cent to Sh12.9 billion while investment income increased 12 per cent to Sh1.8 billion.

READ: Jubilee Holdings profit rises 35pc on high premiums

The company, Kenya’s leading insurer by market share, attributed the performance to ambitious and innovative product development strategies and enhanced relations with insurance brokers.

“Our valuations (for 2014) had put the stock at around Sh490, once you take into account the trading multiples of the insurance segment,” said ABC Capital corporate finance manager Johnson Nderi.

Jubilee has gained 75 per cent this year, taking its market capitalisation to Sh29.3 billion from Sh16.8 billion in January.

Dominated gainers’ list

Longhorn and Kenya Orchards once again dominated the gainers’ list at the market, rising 9.8 per cent and 9.6 per cent to Sh28 and Sh80 respectively.

Longhorn was supported by local investor interest with an eye on the Sh1.20 dividend that was announced last week, while Kenya Orchards once again saw a gain based on thin volumes (500 shares traded) to touch yet another all-time high.

NIC Bank, which closes its register for its rights issue Thursday, was up 3.4 per cent, closing at Sh77. Eveready consolidated the gains achieved on Tuesday when it closed unchanged at Sh4.90 a share although on reduced volumes.

READ: Eveready hits fresh high on factory closure

The leading decliners came from the agriculture segment, with Eaagads and Kapchorua Tea losing 9.1 per cent and 6.3 per cent to Sh40 and Sh135 respectively.

“Within the year, the country has experienced poor rainfall which has affected production. Tea and coffee prices have been low therefore exerting downward pressure on the firms’ profits,” said Standard Investment Bank in a market report.