Kenya's 50 Largest Majority-Local Owned Enterprises By Revenue

The following is a list of Kenya's 50 largest majority-local owned enterprises in Kenya by revenue. The list focuses on enterprises with more than US$100M in annual revenues. The $100M cutoff is chosen because it possible to capture almost all institutions with revenues above this. The sheer size and visibility of these organizations means their revenues are often in the public domain. 

During the research, I noticed there are a substantial number of large and medium-sized enterprises with revenues of between $10M and $100M. Several have a presence beyond the borders. While it is hard to know exactly how many fall in this band, a guesstimate is possible. For instance, look at the increase in the number of enterprises as one moves from higher to lower bands. 

Above $1B              - 6
$400M - $999M       - 9
$300M - $399M       - 3
$200M - $299M       - 13
$100M - $199M       - 21

I would estimate there are 35-60 enterprises with revenues of $10M-$100M.

Back to the Top 50, a number of enterprises would likely be on this list such as New KCC, Simba Corporation, TSS Group, Multiple Hauliers Group, Bobmil Group, Apex Steel and Nairobi Hospital. They have been excluded due to difficulty in obtaining revenue data or logical estimates. The list also includes two companies that were once majority Kenyan-owned but no longer are - East African Breweries and Panafrica Insurance. Both are now majority foreign-owned though marginally.

The entities are drawn from a diverse range of industries and include state-owned institutions. It is near impossible to find one measure that can adequately compare enterprises across different sectors. The 7 parameters often used to compare businesses are revenue, assets, capital, profit, market capitalization, number of employees and geographical footprint. 

I have chosen to use revenue despite its obvious shortcomings. For instance, $1,000 revenue for an oil marketer (e.g. KenolKobil or Hass Petroleum) or retailer (e.g. Nakumatt Holdings or Tuskys) is very different in significance from $1,000 revenue for a bank (e.g. KCB Group or Equity Bank Group). The profit margins are starkly different. While oil marketers or retailers often have profit margins of 2%-10% (in this case $20-$100), it is not unusual for banks to realize a 30%-40% margin (for this example, $300-$400). Two companies could therefore have identical revenue but with one having 10 times the profit.

Still, the amount of money clients are willing to pay for a product or service is perhaps as decent a measure as one can get of the organisation's relative impact on a country's or region's economy. That said, I have included all 7 parameters except capital and market capitalization for the top 50 where available in order to provide context to the numbers.

The focus on revenue though means some institutions that would appear on a top 50 list by assets (e.g. NSSF [$1,319.59M] and Kenya Railways [$620M]) or by profit (e.g. Centum [$46.42M]) have not made the cut.

State institutions have been included though it can be argued that the revenues for some (e.g. Communications Authority) are based on mandatory statutory or regulatory payments. They can thus be looked at as agents of taxation along the same lines as the Kenya Revenue Authority.

Overall, a couple of things stood out during the research to develop the list. 

First is the growing footprint of Kenya's companies on the continent. Kenya's multinationals (even excluding Kenya Airways) are present in places as far west as Cote d'Ivoire and Nigeria, as far south as South Africa and Mozambique and as far north as Ethiopia and Sudan. A number of businesses such as TPS Serena and Davis & Shirtliff that would further demonstrate the regional reach have been excluded from this list as their annual revenues are currently under $100M.

Second is the size of the Sameer Group which is estimated to turnover $2B per annum. The Chandarias' Comcraft Group has been more prominent and widely discussed perhaps due to the company's better known philanthropy efforts (could be as much as $100M in donations to date). However, it is unclear whether Sameer Group's turnover includes Bharti Airtel Kenya's turnover which could distort the numbers.

Third is the absence of Kenya's political class except for the Kenyatta family. There are four plausible explanations for this: 

• A number of prominent families own businesses indirectly through opaque holding companies. Examples are First Chartered Securities and Victus Limited which are both associated with the Philip Ndegwa family.
• Some private businesses have politicians as shareholders. Someone else (usually a prominent shareholder as well) acts as the public face of the company. Sameer Group has been accused of partly holding brief for Kenya's dynasty families (particularly former president Daniel Arap Moi) in the past. In addition, many Asian-owned opted to co-opt leading politicians if only to protect their businesses from harassment and political interference. This phenomenon was particularly widespread during the Moi presidency (1979-2002).
• This is a listing of enterprises by revenue not net worth. As such it is not necessarily an accurate measure of the wealthiest individuals in Kenya. For instance, as alluded to here and here, Kenya's culture ascribes disproportionately high importance to land and property ownership as a sign of wealth. Many of Kenya's wealthiest possess thousands of acres of land whose market value can run into tens or hundreds of millions of dollars (It is a phenomenon I discuss separately here). Back to Kenya's richest, an accurate measure of individual land wealth is nearly impossible to ascertain because, once again, the land is often held under a web of opaque companies.
• Many of Kenya's largest companies are not listed on the stock market (Compare this with South Africa where virtually every big company in the country is listed on the Johannesburg Stock Exchange). This not only means precise financial information is hard to come by (unless the company is in a highly regulated industry such as banking or insurance) but also implies individual wealth remains mysterious and unquantifiable. To put this in some context, lets look at the Dangote Group which is owned by Africa's wealthiest man Nigeria's Aliko Dangote. Forbes places Aliko Dangote's net worth at more than $25B thanks to the skyrocketing of Dangote Cement's share price on the Nigerian Stock Exchange. Yet, the turnover of the Dangote Group is about $3B which is not too different from the Comcraft Group's annual turnover that is anywhere between $2B and $5B per annum. There are obviously other factors that determine share price other than revenue but you get the picture.

Fourth, some companies have most of their business taking place outside Kenya. This is particularly apparent among the oil marketers such as Hass Petroleum and Dalbit Petroleum.

Fifth, the nationality of the largest shareholder is not always the same as the nationality of majority of shareholders. For instance, Equity Bank Group's largest shareholder is Helios Investment Partners at 24.45%. However, the vast majority of the remaining shares (75.55%) are in local hands.

I intend to do a larger list that includes foreign-owned businesses in Kenya with more than $100M in annual revenue. A preliminary assessment shows that these may be between 20 to 30 in number and include Barclays, Standard Chartered, Bamburi, Total, Vivo, Oil Libya, Gulf Energy, CFC Stanbic, Citibank, Finlays, Oserian, BAT, Mombasa Cement, Gapco Kenya, CMC Holdings, Coca Cola, Toyota, Bharti Airtel, Orange-Telkom, Essar Kenya, Tata Chemicals Magadi, Unilever and Aga Khan University Hospital. Some of these are 100% foreign-owned (e.g. Citibank) while others have local shareholding either through the Nairobi Securities Exchange (e.g. Barclays, Standard Chartered and CFC Stanbic) or local incorporation.

Questions and comments are welcome. 

US$ 1 = KES 86.3993 (Exchange rate as at 31st March 2014)