KenGen: Energy utility’s international investment profile elevated

The Kenya Electricity Generating Company PLC (KenGen) expects increased international investment following its induction into the Morgan Stanley Capital International (MSCI) Frontier Markets Small Cap Index.? The MSCI Frontier Markets Small Cap Index serves as a crucial benchmark for institutional investors seeking to gain exposure to emerging economies with high growth potential.? This development signals a potential surge in foreign direct investments for the Nairobi Securities Exchange (NSE) listed firm, highlighting its strategic importance in the global energy sector.

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KenGen said this strategic capital investment milestone enhances its visibility and attractiveness to global investors, positioning it as a key player in the frontier markets landscape.

“This development is expected to enhance shareholder value by attracting more international investment, thereby increasing liquidity and potentially driving up share prices,” said Peter Njenga, KenGen’s Managing Director and CEO.

KenGen says its inclusion in this index underscores its robust financial performance, innovative energy solutions, and commitment to powering Kenya’s future sustainably.

“This inclusion reaffirms KenGen’s commitment to delivering affordable and reliable energy solutions to the nation, fostering economic growth and contributing to Kenya’s vision for a green energy future,” said Njenga.

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The NSE said being part of the MSCI Frontier Markets Small Cap Index provides investors with a unique opportunity to invest in companies like KenGen which have strong growth prospects, solid governance and a proven track record in the energy sector.

“The move will enable wider and deeper coverage of Kenya’s equity market increasing the visibility of companies listed on the NSE and enhance their attractiveness to global investors as the indices serve as benchmarks for institutional investors looking to gain exposure to frontier markets,” said Frank Mwiti, NSE Chief Executive Officer.

Induction into index goes beyond energy investment

Njenga said the inclusion is a testament to KenGen’s consistent performance and strategic growth initiatives.

“We are thrilled to be recognised on such a prestigious global platform, which will undoubtedly attract more investment into our company and, by extension, make Kenya an attractive investment option,” he said.

The broader impact of KenGen’s inclusion in the MSCI Frontier Markets Small Cap Index extends beyond the company, contributing to the overall growth and stability of Kenya’s financial markets.

This move is anticipated to inspire confidence among international investors, thereby fostering an environment conducive to further foreign investment and economic development, said KenGen.

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FAQs about KenGen or electricity in Kenya

What does KenGen do?

Its mandate is to?generate electricity through the development, management and operation of its power plants.

Is KenGen profitable??

The company reported a “significant” 48% growth in profit after tax for the year ended 30 June 2023, surging to Ksh5.02 billion (around $38.9m) up from Ksh3.4 billion (around $26.4m) in the previous year.

Who is the main supplier of electricity in Kenya?

KenGen manages all public power generation facilities and is the main generator of electricity in Kenya which it sells on a wholesale basis to KPLC.?

Where does Kenya get most of its electricity??

Approximately 90% of Kenya’s electricity is generated from?renewable/clean energy sources.