NAIROBI, KENYA, AUGUST 28 ― The Nairobi Securities Exchange (NSE) is set for a major boost as officials from the London Stock Exchange (LSE) jet into the country for talks on a working partnership with East Africa’s leading bourse.
LSE officials are part of the business contingent expected to accompany British Prime Minister Theresa May during her visit to Kenya.
PM May will be making her maiden call to Kenya this week, (Thursday 30) as part of her African itinerary which will include stops in South Africa and Nigeria.
The LSE officials are expected to hold talks with their Nairobi counterparts on underlying opportunities in both country’s markets, and a possible tapping formula.
This includes dual-listing at the LSE and NSE by key publicly traded companies, a move that could boost Nairobi bourse which has continued to record growth in market capitalization with increased foreign investor activities.
According to NSE Chief Executive Geoffrey Odundo, LSE is also keen to support Kenya’s securities market in refining its regulatory framework, build capacity and offer technical advice on deepening the country’s capital markets.
This comes as the National Oil Corporation of Kenya (Nock) is angling itself to pioneer a dual-listing locally, which will see it’s shares trade both at the NSE and the LSE.
During his visit to the UK in April, President Uhuru Kenyatta told UK investors that Nock will be listing at the London Stock Exchange next year.
The listing at the two markets by Nock targets to raise about $1 billion in an initial public offer, which will be through the sale of shares.
The capital is planned for investments locally, which includes buying of a stake of up to35 per cent in two oil blocks at the Lokichar Basin in Turkana.
A partnership with the LSE will be a catalyst for the Nairobi Securities Exchange’s continued growth, which closed the half-year 2018 on a 16 per cent gain in capitalization.
Latest NSE data show market capitalization increased for the year to June grew to Ksh2.58 Trillion up from Ksh2.22 Trillion in a similar period last year.
“Market performance was buoyant in the period under review with equity and bonds turnover edging up 32 per cent and 30 per cent to settle at Ksh108.5 billion and Ksh311 billon respectively for the six months ended 30 June 2018,” Odundo said in a statement.
This buoyed NSE’s (The Company) net earnings which grew 72.1 per cent to Ksh133.9 million up from Ksh77.8 million, mainly on increased commissions from trading activities.
During the period, the self-listed company saw its operating income increased by 24 per cent from Ksh 282.6 million in half-year 2017 to Ksh 351.4 million this year, driven mainly by a 32 per cent increase in equity turnover which grew from Ksh82 billion last year to Ksh108.5 billion.
LSE is already working closely with the Nairobi bourse in enhancing its technology which has seen NSE come up with innovative products among them a recently launched mobile application (App.)
Kenya is among African countries that have benefited from capital raised at the LSE where together with Egypt and Nigeria, the three have raised over $8.5 billion in the UK debt capital market this year alone.
A partnership will hence go a long-way in helping Kenya raise the much needed capital for its development agenda, mainly for long-term finances for infrastructural development.
Meanwhile, May will be seeking renew UK-Africa ties in the wake of a strengthening Sino-African relations, where Kenya is among African countries that have tightened friendship with the East.
The PM’s African trip makes May the first British Prime Minister to visit Sub-Saharan Africa since 2013 and the first to come to Kenya in over 30 years.
During her visit to Kenya, May will meet President Uhuru Kenyatta and visit British soldiers training troops in the country, which are training under the British Army Training Unit Kenya (BATUK) platform.
This is a training support unit of the British Army located in Kenya under long-standing cooperative agreements, with a focus on among others, supporting regional security and stability in the Horn of Africa.