May 23 (Bloomberg) -- Sasini Ltd., Kenya’s largest coffee and tea producer by market value, headed for an 18-month high after agriculture output expanded faster in 2012 than a year earlier, raising the outlook for the company’s tea crop.
The stock advanced rose for a second day, adding 2.6 percent to 13.95 shillings by the close in Nairobi, the highest since Nov. 2, 2011, according to data compiled by Bloomberg. Almost 114,000 shares were traded, more than double the three-month daily average.
The economy in Kenya, the world’s largest exporter of black tea, grew 4.6 percent in 2012 from 4.4 percent a year earlier, supported by increased output in crops and construction. Agriculture, which accounts for a quarter of economic output, expanded 3.8 percent, compared with 1.5 percent a year earlier, Anne Waiguru, cabinet secretary for planning and devolution, said today.
Tea production rose 87 percent in March to 33.3 million kilograms (73 million pounds)from a year earlier. In February the price per kilogram fell to $3.09 from $3.28 a month earlier, according to the Kenya Bureau of Statistics.
“There has been a lot of tea production so it is expected volume gains will outweigh slippage in price, so the first half should be strong for Sasini,” Aly-Khan Satchu, chief executive officer of Rich Management Ltd., a Nairobi-based adviser to companies and high net-worth individuals, said by phone.
Sasini will announce earnings tomorrow for the six months through March. The company’s stock gained 19 percent this year, underperforming a 36 percent increase in the Nairobi Securities Exchange All-Share Index.
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