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Kengen - The forgotten hero
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ngapat
#1 Posted : Saturday, January 15, 2011 2:51:46 PM
Rank: Veteran

Joined: 12/11/2006
Posts: 930
This company is heavily investing in more plants and nobody seems to talk about it. With GDC helping it in drillng geothemal wells, power production will increase and improve its earnings. Consider it a long term buy.

Its the only counter i ever trippled my money in during its IPO
“Invest in yourself. Your career is the engine of your wealth.”
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VituVingiSana
#2 Posted : Saturday, January 15, 2011 3:53:22 PM
Rank: Chief

Joined: 1/3/2007
Posts: 18,361
Location: Nairobi
1) No longer an IPO
2) No longer that crazy euphoria
3) Great to invest but the projects will take 1-5 years to implement. The larger projects will be closer to 5 years.
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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guru267
#3 Posted : Saturday, January 15, 2011 10:14:54 PM
Rank: Elder

Joined: 1/21/2010
Posts: 6,675
Location: Nairobi
ngapat wrote:
This company is heavily investing in more plants and nobody seems to talk about it. With GDC helping it in drillng geothemal wells, power production will increase and improve its earnings. Consider it a long term buy.

Its the only counter i ever trippled my money in during its IPO


@ngapat kengen cannot be talked about because it is fairly expensive relative to the rest of the market...

It has heavy debt on its balance sheet and will continue to report falling earnings for the next few years until its projects are fully complete...

I would suggest you buy K.P.L.C because they have a clean balance sheet, growing earnings, good dividends etc...

But the biggest reason anyone interested in buying kengen should instead buy K.P.L.C is that ALL the growth kengen will experience must be passed on to K.P.L.C as they have no choice to sell all their output to them
Mark 12:29
Deuteronomy 4:16
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Cde Monomotapa
#4 Posted : Saturday, January 15, 2011 11:04:15 PM
Rank: Chief

Joined: 1/13/2011
Posts: 5,964
Indeed Kengen is forgotten hero. I am expecting better earnings primarily just from recovery of hydro in the 1st half and also the higher earnings due to hydro plant availabilty - remember the new PPA with KPLC gives an incentive to Kengen to produce more under a capacity charge proviso. Simply they bill KPLC higher when they produce more electricity.

In the 2nd half Kengen will have approx 200MW new capacity to sell from the various projects that have been commisioned as well as the 120MW Kipevu 3 to be commisioned probably this month.

Lastly, they are expected to start trading carbon credits for their wind and geo-thermal plants.

The market was excited with KPLC saving 60MW from the energy saving bulbs. How much more clean energy does Kengen have to offer currentlyand in the medium term?

This is the simplest investment on the NSE and what I like is that they know how to trade with excess funds. Just last year they made a billion bob from interest income...superfly!!!

BUY<BUY<BUY!
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Gordon Gekko
#5 Posted : Sunday, January 16, 2011 12:02:45 PM
Rank: Elder

Joined: 5/27/2008
Posts: 3,760
Saw some guy on K24 this morning , Samuel Mwangi i think the name was who generates his own power using hydro. He is currently trying to convince his neighbourhood to join the party. Now if we got a sizeable number of such guys around, what portends? Btw, someone should tell him about this genie called carbon credits.....
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chaliwong
#6 Posted : Sunday, January 16, 2011 7:38:57 PM
Rank: New-farer

Joined: 1/10/2010
Posts: 73
Location: kenya
Every six months these guys will announce some credit borrowing from Japan or somewhere.
Its been long since they announced a successful loan from somewhere.
I Expect another announcement soon.
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alikujia
#7 Posted : Sunday, January 16, 2011 10:35:12 PM
Rank: Member

Joined: 5/27/2010
Posts: 324
Location: nrb
chaliwong wrote:
Every six months these guys will announce some credit borrowing from Japan or somewhere.
Its been long since they announced a successful loan from somewhere.
I Expect another announcement soon.

mmmhhh. @Chali, maybe because they got the 25B. I remember somebody remarking here in a a rather oddly tone, he will be waiting to see what Eddy has done with the 25b before buying. @mono, they made 1B in interest some time ago? Anyway now calculate how much they are paying in interest for that 25B bond.
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Cde Monomotapa
#8 Posted : Monday, January 17, 2011 2:37:13 PM
Rank: Chief

Joined: 1/13/2011
Posts: 5,964
alikujia wrote:
chaliwong wrote:
Every six months these guys will announce some credit borrowing from Japan or somewhere.
Its been long since they announced a successful loan from somewhere.
I Expect another announcement soon.

mmmhhh. @Chali, maybe because they got the 25B. I remember somebody remarking here in a a rather oddly tone, he will be waiting to see what Eddy has done with the 25b before buying. @mono, they made 1B in interest some time ago? Anyway now calculate how much they are paying in interest for that 25B bond.


@ ALikujia. They made the 1B in end year June 2010.

You see it is all about the cost of borrowing at the end of the day and I am happy that Kengen understands that.

For example, it pays 12.5% on the PIBO and trades the money that is not in use at the moment making 8%, trading bonds on the NSE etc thus effective cost of borrowing is 12.5 - 8= 4.5% finance cost.

I hope you see what i am saying.
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My 2 cents
#9 Posted : Monday, January 17, 2011 5:20:01 PM
Rank: Veteran

Joined: 6/2/2010
Posts: 1,091
Dividend policy unpredictable, lots of debt. GDC was spun out of it without consideration to current shareholders. Am glad I got out of this dog.
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ngapat
#10 Posted : Monday, January 17, 2011 8:54:29 PM
Rank: Veteran

Joined: 12/11/2006
Posts: 930
I believe the firm's capacity expansion initiatives should bring about a steady growth in profitability in the long run.
“Invest in yourself. Your career is the engine of your wealth.”
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