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Holding Big Losses, Media Firms Struggle to Find Value at the NSE

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Kenya’s leading media houses ended the week at extreme ends at the Nairobi Securities Exchange, in a week that recorded a drop in trading. Nation Media Group (NMG), which recently reported a Ksh375 million loss for the half-year to June 2020, led the biggest gainers table, with its share price increasing 13.27% from Ksh16.95 to Ksh19.20. Other counters that recorded the biggest gains include NSE (9.75%), Kenya Re (7.62%), Sameer (7.43%), and Uchumi Supermarkets (7.14%).

NMG’s gain, which is unlikely to appease investors who have suffered huge losses from its price dip, was driven by the launch of its new digital drive and relaunch of its website from nation.co.ke from nation.africa as it makes a strategic step to monetize digital content, including charging subscription for news. The media company is emerging from a bruising restructuring that pushed out more than 100 employees.

Source: NSE

Generally, media stocks have been disappointing for investors, as business feels the pinch of a drastic drop in advertising due to Covid-19 and an earlier slow down in the economy. While NMG gain is some sort of consolation, its stock has lost it’s biggest value this year.

Nation Media Group, for instance, opened the year at Ksh39.75 signifying a share price depreciation to date of over 60% . The media industry in Kenya is under siege.

The NSE is among few companies that have recorded a jump in profitability despite a slowdown in the economy caused mainly by the Covid-19 outbreak in Kenya, while Sameer and Uchumi were buoyed by increased demand for their shares.

At the losers’ end, Standard Group was the worst performer of the week, losing 11.11% in value as it share price dipped from Ksh22.50 to Kh20.

The drop is seen as the result of negative sentiment from its Ksh306 million loss for the half-year and a pending restructuring that’s expected to devour its revenues.

The losers pack includes Home Afrika (-9.76%), Express (-9.57%), BK Group (-8.81%) and Scangroup (-7.13%). The drop in value has been caused by sell-offs as bargain-hunting investors exit these counters to take strategic positions.

Meanwhile, the equity market closed the week with 92M shares valued at Ksh2.4 billion against 122M shares valued at Ksh2.96 billion transacted the previous week. Turnover for Friday stood at Ksh398M from the previous session’s Ksh1.2 billion, while the number of shares traded stood at 15M against 43M posted the previous session.

The NSE 20 share index was up 20.65 points or 1.11% to stand at 1875.69. All Share Index (NASI) picked up 1.60 points or 1.15% to settle at 140.87. The NSE 25 Share index added 36.23 points or 1.12% to stand at 3260.66

 The Banking Sector had shares worth Ksh640.8M transacted, which accounted for 26.44% of the week’s traded value. Equity Group Holdings rose by 3.79% to Ksh37.00, up from Ksh35.65 registered the previous week, with shares worth Ksh418M transacted.

KCB Group closed the week 3.13% higher to Ksh37.90 moving 3.6M shares valued at Ksh132M. ABSA Bank Kenya moved 5M shares worth Ksh49M and closed at Ksh9.74.

The Commercial & Services Sector had shares worth Ksh23M transacted, which accounted for 0.96% of the week’s traded value. Nation Media Group rose by 13.27% to Ksh19.20, up from Ksh16.95 registered the previous session with shares worth Ksh12.5M transacted.

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The Construction & Allied Sector had shares worth Ksh48.9M transacted, which accounted for 2.02% of the week’s traded value. Bamburi Cement moved 2.4M shares worth Ksh48.5M at a fairly stable price of Ksh20.00.

 The Manufacturing & Allied Sector had shares worth Ksh136M transacted which represented 5.64% of the week’s traded value. E.A Breweries down 1.32% to Ksh168.25 moved 709,000 shares worth Ksh119M. BAT moved 50,000 shares worth Ksh16.5M and closed at Ksh329.50.

In Telecommunication,  Safaricom was up 1.52% to Ksh30.05 moved 51.5M shares valued at Ksh1.5 billion, representing 63.15% of the week’s traded value. [ Media Industry in Kenya ]

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BT Reporter
BT Reporterhttp://www.businesstoday.co.ke
editor [at] businesstoday.co.ke
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