Home Afrika’s value more than doubles on NSE debut

Nairobi Securities Exchange (NSE) chairman Eddy Njoroge (left), Vision 2030 Secretariat Director General Mugo Kibati (centre) and Home Africa chairman Lee Karuri during the bell ringing ceremony which marked the company’s debut on the NSE Growth Enterprise Market Segment (GEMS) at the Stanley Hotel on July 15, 2013. Salaton Njau 

The value of real estate company Home Afrika, which on Monday became the first firm to list its shares on the Nairobi bourses’ new Growth Enterprise Market Segment (GEMS) board, more than doubled on its listing.

Investors traded 21,400 shares at an average price of Ksh25 (0.29), giving the company a market value of Ksh10.13 billion ($116.1 million) even though the nominated advisor, NIC Capital had priced the shares at Ksh12 ($0.14).

According to disclosures contained in its latest annual report released last week ahead of its listing and disclosure document released just after its listing, Home Afrika posted a profit after tax of Ksh167.67 million ($1.9 million) for the year ended December last year.

The results are a reversal from the Ksh199.12 million ($2.3 million) loss posted during the full year ended December 2011.

Home Afrika is the first company to list its shares on the new GEMS board which has less stringent listing requirements and which was created to encourage the raising of capital by small and medium sized enterprises at the Nairobi Securities Exchange (NSE).

Its revenues jumped by 61 per cent to Ksh839.11 million ($9.7 million) as at the end of December last year from Ksh520.47 million ($6.1 million) as at the end of December 2011 with 59.23 per cent of it coming from the sale of plots. 

“This performance was mainly attributable to high demand for land and houses which led to huge plot sales at high premiums and management fees over the last four years,” notes disclosures contained in the disclosure document.

The company made Ksh497.05 ($5.7 million) from the sale of plots and Ksh342.06 million ($3.9 million) from the sale of office suites last year.

In 2011 Home Afrika made Ksh513.41 million ($6.03 million) from the sale of office suites and Ksh7.05 million ($82,961) from managing projects.

The company’s total assets stood at Ksh2.51 billion ($29.3 million) as at the end of last year compared to Ksh2.38 billion ($28.03 million) as at the end of the previous year.

Plots and units held for sale and work in progress valued at Ksh1.27 billion ($14.7 million) was booked as inventories as at the end of last year compared to Ksh1.33 billion ($15.6 million) as at the end of the previous year.

In 2010 Home Afrika posted profit after tax of Ksh15.06 million ($186,522) compared to a loss after tax of Ksh14.19 million ($186,613) in 2009.