By Mercy C.Wanjiku – Journalist

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In your opinion, which are the best shares or companies to invest in that you would advise investors to invest in and what is the minimum requirement that one can invest in?

By nature of business the company does, the returns take long to be redistributable
to share holders. Hence, one should consider this while buying shares. Most
manufacturing companies and real estate companies may generally be classified as long
term while the banks, insurance companies and the telecommunication sector may be
classified as short-term buys.

Are there shares that one can invest in for long term or short term purposes?

In my opinion the following companies may qualify as long term and short-term
buys.Long-term buys include Banks- Equity, KCB, HFCK, NIC, Commercial-Uchumi,
Construction-ARM,BAMB, Energy-Total, KPLC, Insurance-CIC, KNRE, BRITAM and
Investment- Centum and Transcentury Limited.

Are there any benefits one is guaranteed when you invest?

Yes there are. For example, when you invest in a Company you become a shareholder and
that guarantees ownership of part the company.

o One shall qualify for dividends which is distributable profits payable at the end
of a trading period.
o Some companies issue bonus shares to existing shareholders.
o Shares may be used as collateral /security when borrowing loans.
o Shares appreciate in value – capital gains.
o Shares are better than holding cash in the bank as shares can easily be converted
into cash.
o When you buy shares, you become an owner of the company and you have a say and
voting rights in the management of the company.

Normally what is saved should be invested, so shares offer a safe and secure means to
achieve this. For instance, shareholders who bought Barclays Bank shares in 1986 at
Kshs.1600.00,today, own 34,180 shares valued Kshs. 581,060.00 notwithstanding the
amount of annual dividends paid. In the long term shares offer a safe way to thrive
and prosper especially where one can diversify i.e. buy different companies.

Define entrepreneurship and its role in the society

Entrepreneurship is where a person comes up with ideas of starting a business or an
organization.
The business will aim at providing goods and services so as to satisfy consumer
demands while getting profits in return. The entrepreneur develops a business model,
acquires the human skills through employment and other required resources and is
fully responsible for its success or failure. Small businesses that come up through
entrepreneurship are a major source of job creation, income generation and poverty
reduction. This in return contributes significantly to national economic growth.

Do you think Nakuru County and its leadership supports entrepreneurship in any way and does it have any financial capability to support entrepreneurs and entrepreneurship?

Nakuru County has come a long way in supporting entrepreneurs and entrepreneurship as
a sector. This can be seen by the recent changes implemented by the county government
in constructing, restructuring and renovating old buildings. The town witnessed by
the demolition of very old poorly maintained buildings giving room for the
construction of new ones.
Infrastructure, especially the road networks in the county have been improved thereby
increasing efficiency in transport of goods and services. Installation of street
lights ‘mulika mwizi’ has improved the town’s security and made it convenient for
people to do business even at night.
Vendor stalls have been erected in appropriate places bringing reorganization in the
town.
Tidiness has been maintained thereby protecting its name as the cleanest town in East
Africa. All this is in the aim to provide a conducive business environment.

 

What are some of the challenges you experience as a financial adviser or broker?

The challenges are many. Many people remember the erratic behaviour of Safaricom
shares. Everybody wanted to buy the shares. They applied for the shares and the
allocation was pathetic.
Most people were allocated less than 20% of the number of shares one had applied for.
Some investors took loans to buy the shares and almost immediately the share prices
rose to Kshs.7.00.
Unfortunately, it so happened that the share prices plummeted to Kshs.2.00 and the
investors got disillusioned. Things changed only recently when the price started
rising to nearly Kshs.16.00.
After this, the Safaricom I.P.O. (Initial public offer) shares became hard to sell.
In 2013, just before and after the general elections, investors were cautious due to
the uncertainty that prevailed. Foreign investors held back and reduced their
investment in the Kenyan economy.
They feared the return of 2007-2008 political violence. Fortunately, after the
elections, economic activities resumed and investment picked up. Another challenge is
when there is a mismatch between the order price and actual prevailing supply or
demand price; the order may not be executed. This may cause some dissatisfaction with
the client.

What is the future of investing in Kenya?

Last year, Kenya issued Eurobond and it was received well by international investors.
This showed that investors had confidence while investing into the country despite
the numerous terrorist attacks that have been experienced in some parts of this
country.However; the most affected sector was the tourism sector to the extent that
some countries issued adverse travel advisories to Kenya. This led to the decline in
the number of tourists visiting. The future of investing has a great potential to
grow due to the steadily increasing number of individuals in the economic middle-
class. The increase in cash flow from Diaspora means that if wise investment
decisions are upheld, then Kenya will have a brighter future.
The prevailing political climate is conducive to investing in various sectors of the
economy. Though corruption, lack of transparency in the award of contracts and
tenders might give investment a negative a picture.

What advise would you give to those aspiring to be like you?

Start saving early and invest for a less stressful future.