Tuesday, January 31, 2023

Best stocks to buy in 2023

By Benson Bundi

Best stocks to buy in 2023: The action-packed year 2022 is just about over. With the advent of a new administration and the bottom-up economic model, financial analysts think several sectors will likely grow over the next five years.

If you’re an opportunistic investor, consider investing your money in these four sectors in 2023

The Agricultural sector

President Ruto’s policies under the bottom-up economic model emphasize a lot on Agriculture. A farmer himself, the president understands the importance of maximizing food production in the country, especially in the wake of the recent drought.

His first step was to reduce the price of fertilizer, and he has even promised better markets for farm produce.

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If the government continues in the same vein of investing in Agriculture, the sector will have tremendous growth potential in the next five years. Consequently, investing in companies under that sector might be a good idea.

Such companies include Kapchorua, Sasini, BAT, Kakuzi, and others. Food companies are also tied up with the agricultural sector, so you may want to invest in them as well.

Insurance

It’s common knowledge that most of the top government officials in Kenya are renowned businesspeople. Looking at their investment history, you’ll notice that sizeable chunks of their investment portfolio lie in the insurance industry.

History has repeatedly shown that one’s money usually lies where their interest lies. Therefore, these big shots are likely to invest in the insurance industry because that’s where their interest lies. All these factors will likely spur the growth of the insurance sector.

Notable companies in the insurance sector include Jubilee, CIC, Liberty, Centum, Sanlam, and others.

Energy Sector

Fuel subsidies put in place by the Uhuru administration have since been removed, and fuel prices are likely to rise in 2023. Also, Kenya Power recently announced that power costs would likely increase from January. This announcement occurred weeks after Ndidi Nyoro, a seasoned investor, doubled his stake and became the biggest shareholder in Kenya Power.

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Recently, the government said it would commit part of the $447 million IMF loan towards supporting the electricity retailer. All these factors will likely spur the energy sector’s growth, making it a goldmine for investors.

Companies in this sector include Kenya Power, Umeme, Total, Kengen, and others.

Banking Sector

Traditionally, the banking sector has always been a favorite of many investors. In the coming years, the industry will likely be boosted by the bottom-up economic model, which aims to put money in the hands of small-scale entrepreneurs.

The governments continued investment in the jua kali sector will likely mean more money in banks and other micro institutions.

Notable companies in this sector include Equity, Cooperative Bank, Absa, Diamond Trust Bank, and KCB, among others. It’s upon the investor to do their due diligence on which of these companies to invest in.

Conclusion

The Agricultural, Energy, Banking, and insurance sectors are some of the areas set to do well under the Ruto administration, and you may want to invest in them. However, it’s essential to do your research and consult your financial advisor before making any investment decision.

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