KQ share price crashes below Sh 1

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On Wednesday, the Kenya Airways’ share price crashed to Sh 0.97 at the Nairobi Securities Exchange (NSE). The pressure from international travel restrictions and airlines’ financial distresses have contributed to its drop.

A comparison to the previous day shows a 6.73% drop.

Analyst has pointed out that the airlines will likely continue to be affected due to the coronavirus pandemic. 

“Globally, a number of airlines are struggling. KQ revenues are expected to drop; hence investors are selling stocks. Losses are also expected to be very high this year,” said Sarah Wanga, head of research AIB Capital.

“The stock has been trading on a spectacular basis. Negative impact on international travel restrictions and local containment measures have elevated negative sentiment on the stock,” said Churchill Ogutu, Genghis Capital head of research.

KQ has received a blow after a freeze on international passenger travel due to the global pandemic that has left the company with cargo as the only source of revenue.

Also, the 283 cabin crew taken to a mandatory quarantine forced KQ to ground some of its cargo planes due to the reduced number of flight staff.  This increased KQ expenses by more than Sh 80 million.

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The Author of this Article is a registered Financial & Investment Analyst with Institute of Certified Investment and Financial Analyst. If your require more information Email: info@finsolutions.co.ke or +254 780216631

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