Continuing the discussion from the NSE IPO thread - http://wazua.co.ke/forum...amp;m=577818#post577818

In the cartoon world this is how an upthrust sellside plays out.







What are the things to look for in a Uptrust?
1. High volume and how high?
2. Wide price spread?
3. Did it close, near or on the low?
4. What was the previous bar/candle action?
5. Did the bar/candle close into new territory?
6. Is the stock in an up trend?

charts aside, even I can feel thatHFCK is going down soon. that rise to 50.00 was an overshoot. let's brace for what ever is coming. if we have our 'rights' issue now. we won't complain.

I want in on HFCK but at the right price, say sub 40, keeping a keen eye

@Tall Order, it will be equally a Tall Order for HFCK to fall to sub 40 in the short term. I am also waiting.

Hear, hear... Now which are these remains the question. I have my thoughts

tell them sparkly. can u believe ppl clamouring for HFCK at 40.00? at 14.00 bob it was like a taboo to mention buying HFCK.

from your list kengen ,kplc, ken re. all out...gava. leaving kk.

@VVS, I'm a bit concerned with kk's current strategy. I think they have ignored retail business too much. the complete opposite of the days of k card promotions. what if a suitor never comes along or takes too long? their core business is selling fuel to motorists and added value services, they are ignoring this too much. I don't even "trust" their fuel nowadays. and customer care iko down sana. concerned shareholder. glad they are turning the corner though.

@AGuy - Due to personal reasons/developments I was unable to attend the AGM but what you say is true and worrying.

K-Card Discount - That is still there but you have to pay at the Head Office so the users will drop. I used to use KK exclusively but now go to Shell and Total as well.
Payments - Total allows Airtel Money. Shell allows Lipa Na M-Pesa. The KKs I used to frequent take neither, Unless they change strategy they will lose customers. Also some customers use credit cards which allows them 30-55 days to pay as well as manage/review costs for fuel.
Stations - Compare KK to Total. And Total is winning.

Now that KK's cash-flow is steadier, debt levels have dropped [sales of non-core assets], fewer lines of business [dumping Jet A-1], etc ... I expect KK to do much better financially BUT it needs to spruce up the forecourts, replace broken pumps, replace/upgrade the K-Card system, etc.

Ultimately, I think KK is a takeover target nevertheless it should conduct its business like it is going to be 'alone' forever. It is OK to ditch long-term unprofitable lines of business. Pay more attention to the core business of selling fuel and related products. Add convenience stores and mini-supermarkets where possible.

KK needs to get back into the OTS business where it has expertise and connections but should not hedge. It is better to make the margins it can negotiate. Vehicles in EAC continue increasing and that means fuel is required in all parts of the country and KK has the distribution network.

Finally, KK needs to continue pursuing the lawsuit against KPC and settlement against KPRL but quietly. No more grandstanding. Use the best lawyers and fight it out in court. It is likely that GoK will settle the KPRL debts by allocating land, tanks or shares in KPRL [storage] to the claimants. As for KPC, KK has a hand up but it is a 2-3 year process since Kenyan courts are slow.

As a reminder... This is one ugly cartoon for a top. That upthrust will trigger a nice selloff. It is coming...

I read somewhere they sold some shares they held to boost their H1 earnings.

So my sale at 31/= early this year was ok? I needed the cash badly then!