Standard Chartered Bank Kenya on Monday posted a 66.7 per cent jump in its profit at Ksh 9 billion in the fiscal year 2021.
This is compared to Ksh 5.4 billion in the corresponding period a year ago, largely attributable to an increase in Non-Funded Income and lower interest and operating expenses.
“2021 was an exceptional year for the bank despite the ongoing pandemic-driven challenging conditions. Income returned to growth after the dip last year occasioned by the impact of the pandemic, increasing 7 per cent with strong underlying business momentum,”’ said StanChart Bank chief executive Kariuki Ngari.
The Board recommended the payment of a final dividend of KShs 14.00 for every ordinary share of KShs 5.00. An interim dividend of KShs 5.00 was declared and paid in December 2021.
This will bring the total dividend for the year to KShs 19.00 per ordinary share which is 81 per cent higher than that paid in 2020.
“From a valuation standpoint, we view the bank as undervalued given that it is trading at a price to earnings (P/E) ratio of 5.6x (Based on Friday’s close of Ksh131) which is significantly below its five-year historical average trading price of 9.4x,” Sterling Capital says in its Standard Chartered Bank FY 2021 Earnings Update Report.
“To this effect, we maintain a BUY recommendation on the bank with a fair value estimate of KES.167, representing a 27.5% upside on the bank’s closing price of KES.131 as at 12th March 2022.”
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