Manufacturing companies are leading share price declines at the NSE, reflecting investors' gloomy outlook of the sector which is crucial in driving economic growth.
The valuation of shares in the manufacturing and allied segment of the Nairobi Securities Exchange (NSE) has dropped 14 per cent on a year-to-date terms, offsetting overall market gains made in the early weeks of the year.
The segment with firms like beer maker EABL, industrial gas producers Carbacid and
The total market capitalisation of the NSE has in the past month declined from Sh2.03 trillion to yesterday's closing of Sh1.92 trillion.
"The two counters (EABL and BAT) have also been affected by the issue of taxation. The smaller stocks in the segment are largely held by local investors, and have been very illiquid," said
EABL has shed Sh47 billion in value since the turn of the year, with its share price falling 25 per cent to Sh249. The brewer's market capitalisation has dropped below the Sh200 billion level, to stand at Sh182 billion as at close of the market Monday.
The company on Friday said halving of duty remission on Senator Keg has brought down sales volumes on the brand, curbing profit growth.
EABL announced a 5.1 per cent rise in half-year 2014 net profit to Sh3.95 billion. The new excise tax imposed on the previously exempt Senator Keg increased its price 67 per cent to Sh45 a glass and cut sales 85 per cent in the six months through December.
READ: EABL stops daily brewing as growth hits a four-year low
BAT in the meantime has seen a valuation drop of Sh5.5 billion to Sh54.5 billion as at Friday following a price erosion of Sh55 from the Sh600 it stood at the beginning of the year.
Other declining NSE market segments include commercial and services which has shed 6.5 per cent in the past month (down 2.58 per cent in year to date), and the energy segment which is down 6.3 per cent in the past month (down 5.1 per cent year-to-date).
The banking segment which had largely driven the gains in the early weeks of the year has in the past month shed 1.6 per cent to have a collective capitalisation of Sh699 billion, mainly weighed by foreign selling on the big lenders' counters.
The agricultural segment has been the leading gainer in the past one month, with its capitalisation going up 6.12 per cent to Sh12.8 billion. The segment's gains since the beginning of January stand at 23.2 per cent, the best in the market.
All the counters in the segment have recorded double-digit percentage price growth since the turn of the year, led by the suspended Rea Vipingo with a 45 per cent gain in price to Sh27.
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