In our Cytonn Report this week, we analyzed the performance of Kenya’s Equities, Fixed Income and the Real Estate markets for the week ended, with a special focus on Kenya FY’2024 Listed Insurance.
Below are the highlights;
Fixed Income
This week, T-bills were undersubscribed for the third consecutive week, with the overall subscription rate coming in at 94.9%, higher than the subscription rate of 90.9% recorded the previous week. Investors’ preference for the shorter 91-day paper prevailed, with the paper receiving bids worth Kshs 4.2 bn against the offered Kshs 4.0 bn, translating to a subscription rate of 103.8%, higher than the subscription rate of 67.4%, recorded the previous week. The subscription rates for the 182-day paper decreased to 89.7% from the 111.7% recorded the previous week, while for the 364-day paper increased to 96.6% from the 79.6% recorded the previous week. The government accepted a total of Kshs 22.75 bn worth of bids out of Kshs 22.78 bn bids received, translating to an acceptance rate of 99.9%. The yields on the government papers registered a mixed performance with the yields on the 91-day paper and 182-day paper decreasing by 0.3 bps and 1.0 bps to 8.1% and 8.4%, from the 8.2% and 8.5% recorded the previous week respectively, while the yields on the 364-day increased by 0.8 bps to 9.72% from 9.71% recorded the previous week;
Also, during the week, the Central Bank of Kenya released the auction results for the re-opened treasury bonds; FXD1/2018/020 and FXD1/2018/025 with tenors to maturities of 12.8 years and 18.0 years respectively, and fixed coupon rates of 13.2% and 13.4% respectively. The bonds were oversubscribed, with the overall subscription rate coming in at 153.8%, receiving bids worth Kshs 76.9 bn against the offered Kshs 50.0 bn. The government accepted bids worth Kshs 66.7 bn, translating to an acceptance rate of 86.7%. The weighted average yield for the accepted bids for the FXD1/2018/020 and FXD1/2018/025 came in at 13.9% and 14.3% respectively. Notably, the 14.3% on the FXD1/2018/025 was higher than the 13.8% recorded the last time the bond was reopened in March 2025, while the 13.9% on the FXD1/2018/020 was lower than the 15.1% recorded the last time the bond was reopened in December 2024. With the Inflation rate at 3.8% as of June 2025, the real returns of the FXD1/2018/020 and FXD1/2018/025 are 10.1% and 10.5%. Given the 10.0% withholding tax on the bonds, the tax equivalent yields for shorter term bonds with 15.0% withholding tax are 14.7% and 15.2% for the FXD1/2018/020 and FXD1/2018/025 respectively;
During the week, the Kenya Revenue Authority (KRA) released the annual revenue performance for FY’2024/25, highlighting that revenue collection for the period grew by 6.8% down from 11.1% growth in the previous financial year, after KRA collected Kshs 2.57 tn compared to Kshs 2.4 tn in the previous financial year. This translates to a performance rate of 100.6% against the target of Kshs 2.55 tn;
Equities
During the week, the equities market recorded a mixed performance, with NSE 20 gaining by 0.4%, while NASI, NSE 25 and NSE 10 lost by 1.3%, 0.7% and 0.7% respectively, taking the YTD performance to gains of 26.9%, 22.1%, 18.1% and 17.9% for NASI, NSE 20, NSE 10 and NSE 25 respectively. The equities market performance was driven by losses recorded by large-cap stocks such as Equity, Stanbic and Safaricom of 4.1%, 3.7% and 3.5% respectively. The performance was however supported by gains recorded by large cap stocks such as EABL, BAT and DTB-K of 10.7%, 3.7% and 1.6% respectively;
Additionally, in the regional equities market, the East African Exchanges 20 (EAE 20) share index lost by 0.8%, attributable to losses recorded by large cap stocks such as Equity Group, Tanzania Cigarette and Tanzania Breweries of 1.5%, 1.3% and 1.3% respectively. The performance was however supported by gains recorded by large cap stocks such as CRDB Bank, NMB Bank and Bank of Baroda Uganda of 24.6%, 3.3% and 3.2% respectively;
Real Estate
During the week, Knight Frank released its annual report titled Africa Horizons 2025/26, where according to the report 15.0% of Nairobi’s housing units have shifted to short-term rentals, driving a 10.0% rent increase over two years as Nairobi residents are now competing with this new demand. Policymakers and various stakeholders face a daunting task of harnessing economic benefits of short-term rentals without worsening the housing crisis;
During the week, the government expressed its plan to upgrade and improve the Jomo Kenyatta International Airport before the end of the year. This comes after President William Ruto announced the cancellation of the Adani airport deal due to widespread public outcry and concern after controversial clauses in the contract, which had been shrouded in secrecy were discovered in the contract;
Additionally, during the week, Roads and Transport Cabinet Secretary confirmed that the Narok Airport project has officially taken off, with construction already underway. The development is jointly funded by the national and county governments at a cost of KShs 1.4 bn. It is aimed at improving air connectivity to Narok County and the greater Maasai Mara region, one of Kenya’s key tourism and conservation zones. This infrastructure push is expected to open up the area to increased economic activity, particularly in the tourism, transport, and property sectors. The project stands in sharp contrast to the stalled Kericho Airport upgrade, which has been halted due to procurement irregularities and is currently inactive;
On the Unquoted Securities Platform, Acorn D-REIT and I-REIT traded at Kshs 26.7 and Kshs 22.9 per unit, respectively, as per the last updated data on 04th July 2025. The performance represented a 33.4% and 14.5% gain for the D-REIT and I-REIT, respectively, from the Kshs 20.0 inception price. Additionally, ILAM Fahari I-REIT traded at Kshs 11.0 per share as of 04th July 2025, representing a 45.0% loss from the Kshs 20.0 inception price. The volume traded to date came in at 1.2 mn shares for the I-REIT, with a turnover of Kshs 1.5 mn since inception in November 2015;
Focus of the Week
Following the release of FY’2024 results by insurance companies, the Cytonn Financial Services Research Team undertook an analysis on the performance of the 5 listed insurance companies in Kenya, identified the key factors that influenced their performance, and gave our outlook for the insurance sector going forward.
Click the link below to read the Cytonn Weekly report: https://cytonnreport.com/research/kenya-fy-2024-listed-insurance-report-and-cytonn-weekly-28-2025
https://cytonn.com/downloads/cytonn-fy-2024-kenya-listed-insurance-sector-report
