I have used precisely this sort of scenario to good effect in the past, especially when there was a prompt board. However, you have to be very careful. In the case of KPLC, by the time your shares bought at 230 on Friday, 19th clear i.e. Friday this week, the split shares will have been credited and you might find you can only sell your shares at 25. At such a price you will be looking at a loss, so in order to profit, it will very much depend on the particular circumstances.

On the other hand if we had faster clearing, then a profitable outcome would be much more likely.

@sober - Well, they can buy from me! At a nice premium... My target in 18 months (after FY 2011-12 Results) is minimum of 40/- (& having 'eaten' a dividend) For some that 45% (over the current price) is too low in 18 months but I am OK with 30% p.a.)

@mwanahisa, i Hear you. it truly does depend on the circumstanes. Wish the clearing was faster, some of us who watch the boards regularly(all the time), would have opportunities.

By and large the prompt board was abused as not all investors had equal access to the trades there, so I agree with you on that count.

The trading cycle is currently T+4 meaning today's purchases will only be available to sell on Monday, next week. I guess this doesn't concern you too much as you are a long-termer. I do both long and short term myself, so I would dearly love to see a day when we can get instant clearance as happens e.g. on the JSE and other markets.

@ VituVingiSana: The target is very realistic.

With a current EPS of Ksh 2.14 and approximately 20% annual growth for the period June 10 to June 11, then in Sept 2011 after the end of year results are announced(10 Months from now), the share could be trading at an EPS of about Ksh 2.55. At current P/E of 13, that translates to a price of Ksh 33.

By May 2012 (18 months from now), assuming the 20% annual growth holds (and the P/E of 13), then the projected price would be ksh 33 X 1.2 = Ksh 39.60

I intend to join this counter but the timing is critical for maximization of capital gains.

I would feel cheated if i got in at anything higher than the govt conversion price of Ksh 207 (Ksh 25.875).

By December 23rd, I am optimistic that the window of opportunity to get this shares at below this price will present itself.

Post rights and after excess liquidity is mopped up post listing, the share should be trading at the Ksh 28-30 range (P/E of 13 to 14) by March 2011.

Happy hunting.