Home » Kenyan tycoon Suresh Bhagwanji Shah loses $38 million in 2021 as I&M Group shares slump

Kenyan tycoon Suresh Bhagwanji Shah loses $38 million in 2021 as I&M Group shares slump

by Omokolade Ajayi
Suresh Bhagwanji Shah

Kenyan businessman Suresh Bhagwanji Shah has recorded a loss of Ksh4.3 billion ($38 million) since the year began, as the market value of his stake in Kenyan financial services giant, I&M Group (I&M), slumped below $34 million.

I&M is the Kenya-based non-operating holding for I&M Bank Limited, a leading financial services group that maintains active operations through its banking subsidiaries in Kenya, Tanzania and Rwanda, as well as a joint venture in Mauritius.

Shah, a founding member and non-executive director of I&M, holds a 10.8-percent stake in the Kenyan company, which amounts to 178,514,362 ordinary shares.

The year-to-date loss in Shah’s stake can be linked to a sustained sell-off by investors, as shareholders trimmed down their stakes in an effort to pump cash into financial assets with impressive intrinsic value and upside potential.

Due to this bearish sentiment, I&M shares lost more than half their value during the year despite the acquisition of a 90-percent stake in the Ugandan bank, Orient Bank Limited, and a 25-percent increase in its earnings for the first nine months of 2021.

Research conducted by Billionaires.Africa revealed that the I&M share price since the start of the year has fallen from Ksh45 ($0.398) on Dec. 31 to Ksh20.95 ($0.185) as of press time, Dec. 20.

As a result of the slump, the market value of Shah’s 10.8-percent stake has dropped from Ksh8 billion ($71 million) at the beginning of the year to Ksh3.7 billion ($33 million) as of the time of writing.

This accrued a Ksh4.3-billion ($38 million) loss for the businessman since the start of the year.

I&M reported robust financial results in 2021, as increased interest income coupled with reduced interest expenses delivered a double-digit surge in profit in the first nine months of 2021.

Figures for its first nine months of 2021 revealed that the financial services giant posted a profit of Ksh5.7 billion ($51 million), which represents a 25-percent growth in earnings compared to one year ago.

In an effort to deepen its operations in the region and benefit from the gains embedded in assets diversification, I&M acquired a 90-percent stake in Orient Bank Limited.

During the period under review, the group’s assets rose from Ksh344.7 billion ($3 billion) in 2020 to Ksh399.1 billion ($3.5 billion).

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