(Nairobi) – Kenya Airways’ return to the Nairobi Securities Exchange this week triggered a sharp rise in its share price, reflecting renewed investor confidence.
Kenya Airways resumed trading on Monday after a suspension that lasted about four and a half years. Investors responded positively, driving the share price to an early high of KES 6.00 (approximately US $0.046). By the close of trading on Wednesday, the stock settled at KES 4.76 (about US $0.037), giving the airline a market value of KES 25.21 billion (US $193.7 million).
The trading halt began in July 2020, when the government proposed nationalising the airline to rescue it from heavy debts during the global travel slump caused by the Covid‑19 pandemic. At the time of suspension, shares traded at KES 3.83 (around US $0.03).
The nationalisation plan was dropped as the carrier showed signs of recovery, and a change in administration in 2022 shifted policy towards privatisation. Kenya Airways has since returned to profitability, clearing the way for its relisting.
In a notice on Monday, the Nairobi Securities Exchange stated that trading resumed following the airline’s first profit after tax since 2013 and the withdrawal of the National Aviation Management Bill 2020.
Kenya Airways reported a profit after tax of KES 513 million (US $3.96 million) in the first half of the financial year ending June 30, 2024. This performance was driven by a 22 percent increase in revenue to KES 9 billion (US $69.5 million) and a 10 percent rise in passenger numbers to 2.54 million. A turnaround strategy emphasising cost cuts, capacity growth and financial restructuring led to a 22 percent fall in overheads and significant debt reduction.
CEO Allan Kilavuka said in August that the airline had strengthened core operations, improved customer service and explored new growth opportunities. He added that these changes positioned the carrier favourably to meet industry challenges and prepare for future expansion.
Kenya Airways’ long-standing financial woes worsened after a 2017 loan of US $841.6 million from the US Export‑Import Bank, guaranteed in part by the government, drove up debt costs when the US dollar strengthened against the shilling. In 2022, the government took on this debt, converting it to local currency and extending repayment terms to ease financial pressure.
Following debt‑to‑equity conversions, local commercial banks now own about 38.1 percent of the airline, while the government holds 48.9 percent. KLM Royal Dutch Airlines holds 7.8 percent and minority shareholders 2.8 percent.
Despite the turnaround, analysts caution that Kenya Airways’ negative book value of KES 123.6 billion (US $954 million) remains a risk, as liabilities still outweigh assets. Ronny Chokaa of Capital A Investment Bank noted that while the recovery is promising, the negative valuation could temper investor enthusiasm.