Jubilee overtakes Britam in market valuation at NSE

Jubilee Holdings has overtaken Britam to become the most valued insurer at the Nairobi Securities Exchange for the first time since October 2013.

The composite underwriter now has a market valuation of S3.5 billion compared to Britam’s S1.1 billion going by Tuesday’s closing prices of Sh560 and Sh16.05 respectively.

Jubilee is the only insurer to record a valuation gain this year at 24.4 per cent.

It has been able to avoid the worst of the bearish run currently pushing down valuations in the market.

Analysts say that its high nominal price, which is hovering just below its all-time high, means that the stock has been out of reach for speculators who were unwilling or unable to pay the premium for the stock.

“It is a tightly held and thinly traded stock, with people who hold it typically unwilling to sell, thus offering some buffer against the general market decline,” said ABC Capital corporate finance manager Johnson Nderi.

Jubilee has only 59.89 million issued shares at the NSE, with the top 10 shareholders holding about 55 per cent of the stock.

Britam on the other hand has 1.93 billion shares in issue, making it a lot more liquid in the market. According to analysts, the stock has also suffered from some negative sentiment occasioned by regulatory issues faced by one of its shareholders.

“We feel that apart from this issue, it has also been affected by the foreign capital flight given that it had attracted some good foreign inflows last year,” said Old Mutual Securities analyst Eric Munywoki.

“When you look at its fundamentals however, especially in the insurance side, we see notable growth in premiums. At current price the stock is trading at a discount.”

The switch in positions at the top of the NSE insurance segment comes even as regulator data released last month revealed that Britam overtook Jubilee at the top life insurer in the country by the end of the first quarter of this year.

READ: Britam overtakes Jubilee to become top life insurer

Britam increased its market share to 18.7 per cent in March from 17.9 per cent in December last year, rising over Jubilee whose control shrunk to 15.1 per cent from 19.6 per cent at the close of the year.

However, Jubilee remained at the helm of the general insurance business by increasing its market share to 12.8 per cent from 10 per cent in December. Britam market share in the general insurance business stands at 4.58 per cent.

Jubilee’s assets at the end of December 2014 stood at Sh74.5 billion, while net profit was S.1 billion. Britam’s assets stood at Sh72.5 billion, with net profit for the year at Sh2.5 billion.

When general and life businesses are combined therefore, Jubilee remained the largest insurer, according to the Insurance Regulatory Authority data.

Other insurance counters have been affected by the bear run in the market, which has seen more than 40 counters in the bourse recording price declines this year.

Pan Africa Insurance Holdings is down 47.5 per cent to Sh63.00 per share, with its market valuation currently standing at Sh6 billion.

CIC Insurance has also taken a battering, losing 31.3 per cent of its value to Sh6.60, though it remains the third-largest listed insurer with a market capitalisation of Sh17.3 billion.

Liberty Holdings is down 3.2 per cent to Sh22.50 a share with a market cap of Sh12 billion, while Kenya Re is valued at Sh11.6 billion after shedding 2.9 per cent to Sh16.55 a share.