Mumias Sugar Co. (MSUG), Kenya’s biggest producer of the sweetener, gained the most in almost two weeks after Old Mutual Securities Ltd. started coverage of the stock with a “strong buy” recommendation.
The shares climbed 6.6 percent, the most since April 20, to close at 5.65 shillings in Nairobi.
“Our investment premise is based on high sugar prices prevailing in the market both locally and internationally and the sugar deficit in the local market,” Old Mutual said in an e-mailed note to clients late yesterday.
Higher sugar prices have been the main driver of revenue for the company and have cushioned it from inconsistent supply of good quality cane, Old Mutual said.
The price target was set at 9.87 shillings.
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