The long wait is over. Safaricom had a first day debut in excess of 50% on its first day of trading. Kenya's biggest stock market flotation is clearly a success. Foreign investors were required to pay 10% more than the price offered to Kenyans but we don't think that is unfair. What is moe important is that the sale was oversubscribed by more than 500%. Clearly, investors have appetite for Kenya again.
Kenya's mobile phone market is not saturated, indeed only a third of Kenya's 36 million people own a mobile phone. That said, on every street you can buy a credit for a phone. We believe
Safaricom's strategy of targeting low-income clients like this will boost its customer base.
Safaricom is East Africa's most profitable company, it made profits of $370m last year, and despite the price rise remains attractive and a core holding, entering our model portfolio.