In conducting a post-mortem of the markets, 2015 was a tough year in the markets especially for market intermediaries i.e. stock brokers, investment banks, fund managers etc. Now when a good number of these players’ revenues plummeted in 2015 due to an unprecedented bear market which began around March last year; we have picked one of the Fund Managers who achieved impressive growth. So what was the play?
NSE 20 Index (5 Year Chart)
Source: Bloomberg
We now look deeper at a Fund Manager called Dry Associates.
So who is Dry Associates? Dry Associates is a Fund Manager which was established in 1994. It has expertise in Corporate Finance and Private Wealth Management.
According to a 2014 report by New World Wealth, Dry Associates is recognized as a Wealth Management Service provider with an office in Kenya along with GlobalEye, Intouch Capital, Inter Alliance International and Private Wealth.
Recently Dry Associates published their 2015 Financials as shown below:
From the above results Total Income grew by an impressive 68.5% to KES 319Mn driven largely by an increase in brokerage commissions. In a note on the company’s third quarter performance it was noted that:
“The company’s financial results reflect an increase in turnover in every revenue category including offshore funds, pension funds, and most impressively brokerage fees for placement of fixed income securities. The increase in placement fees for fixed income securities can be attributed to some extent to the very favorable interest rates on offer in Kenya during the 3rd quarter.”
Profit before Tax increased by around 90% to stand at KES 144Mn compared to the previous year’s figure of KES 75Mn. Strong results! Evidently the play was in Fixed Income.
Dry Associates recently received approval by the Capital Markets Authority in offering Unit Trust products as noted from their December 2015 Newsletter and are expected to have already been rolled out in the market.
The most recent deal by Dry Associates helped Nakumatt raise KES 2 Billion through a Private Medium Term Note.
Something to note also is that Dry Associates offers offshore solutions through Franklin Templeton Investments, a global leader in investment management.
Source: (Dry Associates, Bloomberg, New World Wealth)
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