A recent report by Faida Investment Bank shows that Banking stocks were among the best performing counters at the NSE in the first quarter of the year. The sector’s average return on equity stood at 13.5 per cent. All listed lenders had ROE above 12 per cent with the exception of National Bank and Housing Finance. In terms of price appreciation, I&M holdings and NIC group had the highest price gain since the start of the year at 33.5 per cent and 30.8 per cent respectively to close at KSh113.50 and Ksh36.40. The good performance can be attributed to high earnings released by most banks in March.
The telecommunications sector, represented by Safaricom, also registered great performance. Return on equity amounted to 47.8 percent, one of the highest rates recorded at the NSE. The Telco’s share price gained 24 percent in value in the three months period that ended on 29th March.
Insurance sector stocks recorded weak results in the first quarter of the year. The industry blamed the tough economic environment for their dismal earnings. Britam and Sanlam booked the largest net losses equal to KSh3.4 billion collectively. The two companies lost 9.8 percent and 4.3 percent of their market value by the end of Q1.
In the 3 months period, 15 listed companies, equivalent to 24 percent of NSE firms, issued profit alerts, an indication of lower earnings. Despite the unimpressive results by several companies, NSE gained 12 percent in the period under review. The Ugandan, Tanzanian and Rwandan stock exchanges gained 6 percent, 0.9 percent, and 3.5 percent in the same period.
