, NAIROBI, Kenya, Apr 15 – The Nairobi Securities Exchange (NSE) posted a 210 percent increase in net profit to Sh263 million in 2013 from the Sh84.78 million recorded in 2012.
Market capitalisation rose by 49.91 percent to Sh1.92 trillion while the NSE all share index moved up by 33 percent in the period driven by the 79.45 percent rise in equity turnover to Sh155.75 billion from the Sh86.79 billion recorded in 2012.
The NSE Chief Executive Officer Peter Mwangi says the profits are attributed to higher proceeds from transaction levies underscoring investors’ confidence in the Kenyan economy.
Mwangi said 2014’s outlook is positive as the bourse will introduce the much awaited Real Estate Investment Trusts (REIT), Exchange Trade Funds (ETFs) as well as the launch of the derivatives exchange.
“In 2014 we see inflation more or less stable around 7 percent and we expect the Kenya shilling to depreciate gradually as it should over time, the current account deficit and fixed deficit will also remain manageable,” he said.
He said the sovereign bond that is expected to be issued by the government this year will increase the price in the local bond market that will increase investors’ appetite.
The turnover in the bond market was Sh452 billion for the year 2013, an average of Sh38 billion a month.
“Foreign investors remained at just above 50 percent; we saw a lot of domestic investors coming back to the market but the global investors maintained their share.”
The bourse expects to complete the demutualisation process this month having made the final application to the Capital Markets Authority (CMA) as well as having agreed on all the issues that had been withstanding.
“The completion of the demutualisation process will then open the door for us to list on the Main Investment Market Segment (MIMS) via an initial Public Offer (IPO),” he said.
The exchange will also invest about Sh250 million to upgrade the technological systems that will support the trading of equities, implement a new system for the trading of bonds, and implement systems to support the new markets that include REITS and ETFs.
The board of directors has proposed a final divide of Sh2 per share amounting to Sh49 million up from the 2012’s Sh1 per share.
The exchange recently underwent a re-brand as part of their strategy to reposition themselves as a more inclusive brand, with the aim of encouraging an investment culture among Kenyans that fully embrace the capital markets.