Best Companies to Invest in Kenya (in the short term and long term)

Want to know the best companies to invest in Kenya? Well, you’re in the right place.

Here you’ll find a list of the best companies to buy shares in Kenya as well as learn about other profitable passive investment options you can try.

Now, if you have ever wondered how to invest in companies in Kenya, buying shares is one of the best ways (yeah, prices fluctuate but investors who hold on for the long term usually get extraordinary returns).

You can also invest in money market funds and unit trusts- CIC insurance company has great products here.

Other options you can consider are M-Akiba bond (the 10% interest rate, paid two times in a year is quite ok considering that this is a risk-free investment).

Now, I’m not an investment guru but here are my thoughts about the best companies to invest in Kenya.

Best Companies to Invest in Kenya – my recommendations

Perhaps the best way to look at investing in Kenya is by looking at the details about each of the available options.

So we shall start by looking at investing in stocks in Kenya because a lot of Kenyans find buying shares a viable investment- it’s way better than leaving your money idle in the bank because inflation will gradually eat away on it!

That being so, here is my selection of the companies that are worth buying shares in, for Kenyans (in my opinion)..

List of the Best Companies to Invest in Kenya

Now, the best company to buy shares in boils down to your investment strategy (and risk appetite).

I’m saying so because if you’re a short term investor and you’re looking to make quick capital gains on shares you buy (by buying and selling shares as soon as there are gains to be made), the companies that will make sense to you are those whose share prices experience a lot of volatility.

If that’s you, I personally find the following companies worth investing in:

KPLC

KPLC has run into headwinds recently so people are constantly dumping the share while others are getting in daily, in the hope that government will save the company at some point.

This has made the price of this share experience plenty of up and downturns so it can be a good choice (while this trend lasts).

Home Africa

Home Africa has been one of the most volatile penny stocks in the market for years now and it’s still a nice choice for speculative investors.

Bamburi Cement

This stock has been seeing a lot of movements in price lately and can be another potentially good stock for short term traders.

CIC

CIC’s share price changes pretty fast too and I feel that it can pay you if you’re going short.

Kengen

The price of this state-backed stock is typically moving up and down (mainly because of the problems at Kenya Power, which is essentially Kengen’s main customer).

NCBA

NCBA Share is medium-priced and is often seeing ups and downs these days, making it a good fit too (probably) for those looking for short-term returns.

Sameer Africa

As with the other shares here, Sameer Africa share price is extremely erratic which makes it appealing to aggressive risk-takers.

Best companies to invest in if you want to go long

On the other hand, if you’re okay holding on to a share for years in anticipation of a significant rise in price (sometimes the price of some shares double and even triple over the years), I recommend these 5 companies:

Safaricom

There is nothing that indicates that Safaricom will be dislodged from its dominant position as Kenya’s largest telco in the near future.

For this reason, you can bet on the price of Safaricom shares to continue its upward trajectory.

Equity

Equity group has diversified very well (it has opened operations in East and Central Africa) and the future looks very promising.

As a result, I expect Equity group share price to rise significantly in the next few years.

KCB

Just like Equity, KCB’s bank business looks stable and might remain that way in the foreseeable future.

EABL

Despite increased competition from cheap liquors and Keroche Breweries, East Africa Breweries has generally retained a stranglehold on Kenya’s beer industry and will continue doing so in the coming years (unless something drastic happens).

Kakuzi

Kakuzi has been performing well in the last few years and can also be a good bet for long term investors looking for repeat dividends and capital gains.

Important tips for investors

Invest in top 5 Banks– Banks have several layers of security from CMA and CBK and the possibility that one of these banks will go under is very remote.
Invest in companies that can never be allowed to collapse (due to their strategic importance to the state)– This list has companies such as Safaricom, NSE ltd itself, Kengen, and Kenya Power.
Invest in companies with significant presence outside Kenya– outside business gives a company a chance to survive turbulence at home. Here we have companies such as Equity, EABL, KCB, ScanGroup, etc.

A list of 24 solid companies in the NSE that you can invest in

Here now is a full list of 24 companies that have been most solid in the NSE – I believe that all investors should generally consider them (both as short-term as well as long-term investment options):

Safaricom
Equity group
KCB Group
Co-op Bank
Standard-chartered
BAT Kenya
EABL
Centum (not as profitable as the past, but still a fine stock)
Kakuzi
Jubilee holdings
NCBA Bank
ABSA Bank (formerly Barclays bank)
IMH (I&M Holdings)
Kengen
Carbacid
BOC
WTK (Williamson Tea Kenya)
Kapchorua tea
Bank of Kigali (BK Group )
Nation Media group
Bamburi cement
Umeme
Scangroup
Total Kenya

Away from Shares, consider these investment options

M-Akiba

This is one of the most attractive, zero-risk savings products offering a good ROI (return on investment) for Kenyans.

This government bond pays you 10% per year.

Dial *889# (from a Safaricom line) to get started.

Money market funds in Kenya

MMFs are another low risky options you can invest in and get reasonable returns (the average return rate is 8% per annum).

Check out CIC money market fund, if you’d like to explore this option.

Commercial papers

Commercial papers are used by various organizations to raise funds and pay excellent rates.

The only problem here is that it has been a long time since I heard Kenyan companies or financial institutions offering one.

Infrastructure bonds

These are used by the government to raise money for its infrastructure projects and can be a fantastic investment if you don’t mind waiting for years (maturity is up-to 30 years).

You can still trade them in the secondary market but it’s better to wait since you’ll get a premium rate of return for your patience.

Check CBK website for infrastructure bond offers.

Treasury bonds

These are yet another investment option offered by the government that is risk-free.

Treasury bill

This is a short-term borrowing instrument (paperless) that is Government issued.

SACCOs

Some SACCOs pay as much as 15% on share deposits and you can look for a trustworthy one.

Trade in US Stocks

There are many US stocks you can buy (and sell) depending on your strategy.

I will be doing an article on how to buy US stocks from Kenya a little later so stay tuned.

Wrapping it up

There you have it- the best companies to invest in Kenya under the Nairobi Securities Exchange.

To answer the question of what is the best way to invest in Kenya, it’s not possible to point out one best option since investment goals and risk appetite vary from one person to the next.

But you at least know where to start now…

Cheers to profitable investing!

PS: Tell me: What other investment options are you investing in and is it profitable? I know a lot of people like rentals and cryptos but I will appreciate if you leave your answers in the comments.

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