Lafarge which is the world’s largest cement maker is in the process of acquiring Egypt’s Orascom Cement for a reported Euro 8.8 Bn. Read more
This enhances its penetration in Emerging markets and in particular in Africa. The French company was also in plans to consolidate its businesses here in Kenya. Read more and also ; though unsuccessful at the first shot earlier in the year, it’s believed they could be currently working on a counter proposal.
Lafarge has a 41 per cent stake in East Africa Portland and a 17 per cent stake in Athi River Mining Ltd. And a 58.6% controlling stake in Bamburi Cement.
The company also holds a majority stake in Cement manufacturers in both Uganda and Tanzania with plans currently underway to double the capacity of the Uganda plant.
With current market developments and the housing boom which is likely to be sustained come next year, Riba Capital holds a very positive outlook in the Cement industry.
And I would recommend that we hold a cement company in our portfolio’s.
The past few years have seen all the three companies post record earnings and with their current market prices at Bamburi - Kes:195.00, E.A Portland – Kes:136.00 and Athi River Mining at Kes: 92.00, I think these stocks are good. Though you I would recommend an entry during the Safaricom IPO, if it takes place later in the month or at least the week of elections when prices might take a dip.
