Good news to those looking for investment opportunities in Kenya 2019 ! Recent report by Hass Consult have indicated that stocks are undervalued and primed for a rebound as investors troop back to buy on the cheap.
“According to this report, the equities market is set to recover greatly in 2019 as cheap valuations currently exist in the market, which is bound to interest investors.
“Moreover, we are likely to see foreign investors jump back to the market and reverse the net selling trend we have witnessed this year on account of a stable macroeconomic environment,” said Genghis Capital analyst Patrick Mumu.
These are the investment opportunities in Kenya 2019 you should check out;
Fixed income returns
Fixed income returns were most favorable in 2018, the yield on the five-year bond having averaged 12 per cent, while the shorter-term 91- and 364-day Treasury bills averaged 7.8 and 10.5 per cent respectively.
They are tipped to retain a positive return this year, even though the yields may fall gradually as banks deepen their lending to government instead of the private sector.
“For fixed income instruments, we are likely to see a gradual decline in yields as government continues to crowd out the private sector and reject aggressive bids in the auction market,” Mr. Mumu said.
Meanwhile, the shilling has been largely stable, appreciating by 0.6 per cent to the dollar in 2018.
A key risk, however, remains for the capital markets in the form of rising US interest rates that have led to flight from emerging and frontier markets.
Real estate industry, which suffered a tough year in 2017 during the prolonged electioneering that spooked investors, is seen as likely to continue its modest recovery in 2018, driven by demand in the hospitality sector.
Local investors who took a battering from the dismal performance by the Nairobi Securities Exchange (NSE) in 2018 have an opportunity to recover this year as the market claws back some of the lost ground, analysts said.
Another investment opportunities in kenya 2019,Property and offshore investments have also been tipped to give higher returns after having closed the year with lower income returns than the previous years.
The benchmark NSE 20 share index closed 2018 trading at 10-year low levels having shed a quarter of its value at the beginning of the year to stand at 2,755 points.
The All Share Index closed the year at 19-month lows, having shed 18.8 per cent in 2018. Investor wealth — measured by market capitalization — shed Sh442 billion in the year to close at Sh2.08 trillion.
It has been a sharp turnaround for the market, which closed 2017 as the best performing asset class after gaining 17 percent for the NSE 20 and 27 percent for the NASI.
Analysts, however, said the market seems to have hit a resistance level of 2,700 points, giving investors hope that the debilitating bear run may have bottomed out.
Multiple reports filed by players in the different investment segments have indicated that the Nairobi bourse largely stood out in the past year as the sole major investment class that produced negative returns.
The travails of the market is bad news for pension funds and insurance firms, who are among the biggest investors in equities.
In the one year to September, sale prices for houses in Nairobi went up by 8.1 per cent, while rental prices rose 4.7 per cent, according to market data compiled by realtors Hass Consult.
Nairobi has been attracting a higher number of high-profile meetings and international conferences that have seen a rise in demand for hospitality units.
“The flourishing niche market for meetings, conference and exhibition tourism has opened investment opportunities in Kenya 2019 for entrepreneurs who are turning houses and apartments for renting to attendees of major conferences, some of whom prefer serviced apartments and houses over hotels and this is resulting in an uptick in prices,” said Hass Consult’s head of development consulting and research, Sakina Hassanali, in the firm’s price index for quarter three of 2018.
Investment firm Cytonn said the Nairobi metropolitan area, which had approximately 3,414 serviced apartments at the end of 2015, is expected to bring on board additional 1,174 by 2020.
Land prices are, however, likely to be dampened as buyers anxiously await details of the government’s 500,000 affordable housing plan.
“The Housing department has stated that it will among other initiatives invest in infrastructure in certain suburbs and satellite towns as well as develop some of its land holdings.
These actions could potentially tilt the market as investors often go where new infrastructure is being put up,” said Ms Hassanali.
Offshore investments were among the most improved in terms of returns in the past year, having increased annualized returns in the one year to September 2018 by average five per cent compared to the same period in 2017.
Pension firms, which are among the most active in this segment, reported that average returns from this asset class in the year to September 2018 stood at 7.7 per cent, according to a survey done by fund administrator Zamara.
In the corresponding period in 2017, the returns stood at 15.4 per cent.
They are, however, likely to continue giving a positive return due to rising interest rates in the US, where the Federal Reserve has jacked up its benchmark rate to 2.5 per cent, with a further two raises expected this year.
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