- The All Share and NSE 20 Indices gained by 0.7% and 0.2% to close the day at 141.04 and 1,986.48 respectively. Equity turnover increased by 47.1% to KES 716.7million. Notable gainers for the day were Britam (+9.5% driven by foreign demand) and Stanbic (+6.8%). Safaricom gained 1.0%, accounting for 74.0% of the day’s traded value. Foreign investors emerged net buyers with foreign buys at 85.4% against foreign sales at 47.5%. We expect the pickup in activity to sustain for the rest of the week.
Kenya Airways Banks on Cargo with UAE Route
According to the Business Daily, Kenya Airways (KQ) has started cargo flights to the United Arab Emirates (UAE) in a bid to grow revenues via freight, as passenger flights remain restricted owing to the Covid-19 pandemic.
KQ will run two weekly flights but may increase if demand grows
The cargo flights will primarily transport meat products such as tropical fish, fresh fruit, flowers and general cargo to Sharjah International Airport and import general cargo and high-tech goods.
The airline has been employing strategies aimed at business turnaround and gaining competitive advantage.
According to management, the airline was mainly moving personal protective equipment (PPE) in April. However, with time, demand has declined owing to increased local production.
As noted previously, the airline continues to face the challenge of increased competition and high operating and financial leverage.
Without a clear long-term turnaround strategy, we recommend investors to keep away from the stock
Long Term Buy- KCB, Equity, Absa, Stanbic, NCBA
Sell- Stanchart, Bamburi, HF