Housing Finance Co. (HFCL), Kenya’s only publicly traded mortgage lender, headed for its biggest gain in more than six months on bets the sale of 3 billion shillings ($35.3 million) worth of bonds will be successful.
The stock advanced 3.4 percent to 15.10 shillings 11:45 a.m. in the capital, Nairobi, the biggest gain since March 28.
“By the time they went public about the bond there was a huge chunk that had been taken by the institutional investors,” Rufus Mwanyasi, head trader at Nairobi-based Canaan Capital, said in a phone interview. “The stock is gaining because the bond will be fully taken up.”
The bond sale, which began Oct. 1 and closes Oct. 12, is the second portion of 10 billion shillings it has regulatory approval to sell. The company raised 7 billion shillings from a bond issue in 2010.
The proceeds will be used to build houses, Managing Director Frank Ireri said. About 200,000 houses are needed in Kenya’s urban areas each year and only about 50,000 are built, he said last month.
To contact the reporter on this story: Eric Ombok in Nairobi at firstname.lastname@example.org.
To contact the editor responsible for this story: Shaji Mathew at email@example.com