Kenya: Analysts expect bigger Safaricom gains

Kenya’s largest mobile-phone operator, Safaricom, continues to show robust movement on the country’s stock market, leaving analysts expecting continued growth.

CEO: Bob Collymore

The boosts are the longest winning streak for the company since mid-December and come as the company’s earnings are to be released in the near future. The stock was trading nearly 20 percent higher on Monday and had gained nearly 3.3 percent.

“Increased trading on Safaricom is expected as investors react to the regulator’s released statistics,” Nairobi-based Kestrel Capital East Africa Ltd. said in an emailed note to clients. “The counter closed with pent up demand at the 3 shilling level on Friday.”

Mobile subscribers in the east African nation increased 4.8 percent to 25.3 million in the quarter ended September, Kestrel said.

During the quarter, Safaricom – which is 40 percent owned by Vodafone Plc  – recorded the highest number of new customers at 593 177, followed by Airtel Networks Kenya Ltd., controlled by Delhi-based Bharti Airtel Ltd., with 557 567 new subscriptions, the Communications Commission of Kenya said in a statement.

Essar Telecom Kenya Ltd., a unit of Essar Group of India, added 46 742 new customers while Telkom Kenya Ltd., a unit of France Telecom SA, added 16 683.

Analysts are hopeful that positive reporting will continue to see growth in the country’s largest mobile operator.

“I think if we look at it from a long-term perspective, Safaricom has really shown strength in developing their public status and are creating a push forward this year and we don’t expect it to stop in the near future,” Nairobi-based stock and telecom analyst John Thakeb told IT News Africa.

“We should be confident that this is a great time for mobile and technology in Kenya and Safaricom is making it happen,” he concluded.

Source: IT News.Com – 10 Jan 2012