An investor looks at the digital board at the Nairobi Stock Exchange(NSE)/FILE Safaricom’s command at the Nairobi Securities Exchange dropped below 50 per cent for the first time in three years, illustrating Covid-19 economic pressure on the bourse.
According to the NSE end year barometer, the telco in 2020 commanded 48.3 per cent of total turnover at the Nairobi bourse which accounts for Sh77.7billion.
This is a 2.6 per cent drop from 2019 when the telco accounted for 50.9 per cent of NSE’s market capitalization.
The telco last year struggled with dropping revenues on account of the zero-rated M-Pesa transactions which led to a six per cent drop in its half-year net profit.
M-Pesa earnings in 2020 dropped 14.5 percent to Sh35.9 billion from Sh42 billion over a similar period in 2019.
While zero-rating of fees on transactions of up to Sh1,000 had hurt M-Pesa revenue, the move had helped it win new customers.
One month active M-Pesa customers increased by 13.5 per cent to 26.79 million
Total M-Pesa transaction value grew by 32.9 per cent to Sh9.04 trillion while the volume of transactions grew by 14.9 per cent to 5.12 billion transactions.
Voice revenue declined 6.5 per cent during the period to Sh40.19 billion while messaging declined 6.9 per cent.
The two account for 40 per cent of the company’s total revenue.
On a monthly basis, however, it ruled 51.8 per cent of the market share accounting for Sh5.29billion.On March 14, a day after Kenya announced its first Covid-19 case, trading at NSE was halted as traders desperately offloaded their shares.This saw the telco’s share start falling, hitting a low of Sh24.35.The Safaricom counter, however, remained sturdy after defying the pandemic odds and its counters occasionally bleeped green when all others were in the red zone.A minimal fall in the Safaricom share price creates an impression that the market is underperforming despite other counters recording gains.The telecommunication sector however despite the pandemic had gains in the year, even as most counters experienced losses.The sector recorded an 8.7 per cent growth in returns in the year.Soon after the zero-rated transactions ceased from January 1, 2021, the telco’s share shot up at the NSE trading at Sh34.In the year 2020, the five biggest stocks traded at the Nairobi Securities Exchange accounted for 88 per cent of the total value of shares listed an increase from 78.2 per cent in 2019.Following Safaricom is Equity bank which accounts for 17.1 per cent, […]
