Kiharu Member of Parliament Ndindi Nyoro has finally given in detail a statement as to why he tripled his Kenya Power and Lighting Company shares.
The member of Parliament became the largest individual shareholder in KPLC after tripling his shares from 9,116,800 to 27,291,400 in June 2022 which makes him third on the company’s stake after National Treasury and Standard Chartered Nominees.
In his statement, Nyoro said the company’s shares were going below ksh 2 with the power utility’s valuation highlight an insignificant percentage of KPLC’s assets.
More than that, the Kiharu MP said his move was not only influenced by such financial power points but also by his investment fundamentals instincts.
“With gross full-year revenues of approximately Ksh150 billion, assets of around Ksh325 billion, probably Kenya Power is undervalued. The market values the company at around 1 percent of its assets base. The current market capitalization being at around Ksh3 billion.”
The statement meant KPLC is underrated and has high potential with the right administration.
“Using the half-year Financials of up to Dec 2021, where Earning Per Share (EPS) was Ksh 1.96, then the Price Earnings (PE) ratio is just about 0.5 or half a year. This means if the company were to pay all the earnings as Dividends, it would take one 0.5 years to recover the investment.”
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Nyoro further explained that he had little control over the company’s decisions and was only a silent investor as the Government (who are the largest investors) made most of the decisions.
” The government owns approximately 50.1 percent of Kenya Power. All directors are therefore appointed by the State. Our small stake is passive. We make zero decisions and therefore purely a silent, retail investor.” He added.
He added that Kenyans can also join in the venture and purchase shares by opening a Central Depository System (CDS) account, giving an example of investments made during Kibaki’s Regime.
“I know of an investor in a local airliner whose investment of Ksh500k turned to Ksh70 Million. Some bank shareholders from our villages became Millionaires out of their investments in the companies especially before listing and immediately after listing.”