Sept. 6 (Bloomberg) -- Diageo Plc’s Kenyan unit rallied a second day, pushing a key technical indicator above oversold for the first time in three weeks, as investors bet on stronger profit in the first half.
East African Breweries Ltd. advanced 1.4 percent to 296 shillings by 2:15 p.m. in Nairobi, the highest on a closing basis since Aug. 28. Almost 1.3 times the three-month daily average of shares were traded. The relative-strength index rose to 35, the first increase above the 30 level that indicates to technical traders a stock may be set to rebound, since Aug. 16.
Profit in the 12 months through June fell 38 percent as costs increased and after a one-time gain last year wasn’t repeated, the company said on Aug. 23. Revenue climbed 6.4 percent. Kenya’s government forecasts economic growth of 5.8 percent this year, the fastest pace in six years, from 4.6 percent in 2012.
“Because the full-year numbers mostly had a one-off expense which resulted in lower earnings, investors believe the next set of numbers will have some element of growth,” Eric Musau, an analyst at Nairobi-based Standard Investment Ltd., said by phone.
EABL’s shares gained 12 percent this year, slower than the 26 percent increase in the FTSE NSE Kenya 25 Index.
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