Uchumi Supermarket will by the end of 2014 open two new outlets in the Rwandan capital, Kigali in addition to its 30 outlets in Uganda, Tanzania and Kenya
This comes after the regional chain store, with its base in Kenya, signed construction contracts with a Rwanda-based property firm which will construct the store premises in the next twelve months.
Jonathan Ciano, Uchumi’s chief executive said the move is also expected to reduce its reliance on Kenya, while the EAC regional economy is growing rapidly, especially in Rwanda among other countries.
Ciano said that the Rwandan retail sector is vibrant and has a growing middle class with disposable income such as in Kenya and Uganda. “We hope to sign two more contracts of the same kind next year as a way of expanding Uchumi outlets across other towns in Rwanda”
Uchumi supermarket was cross-listed on the Rwanda Stock Exchange this October 2013; however there has not been much activity on the Rwandan bourse. By having its stores opened in the Rwandan market, it is expected to be a key turning point for the local bourse and a vote of confidence in the local financial sector.
Uchumi is the third Kenyan company to float shares on the Rwanda Stock Exchange. Others include: Kenya Commercial Bank (KCB) and Nation Media Group (NMG), which have been part of the four firms listed on the stock market, including Bank of Kigali and Bralirwa.
Uchumi, which is aiming to offer up to 100 million shares in a rights issue set for next year and expanding to Rwanda market is seen as an avenue of reaching other markets in the region, especially in Burundi.
“Once we have established ourselves in Rwanda, it will be easier to penetrate the other markets,” said Ciano.
Uchumi’s profit before tax rose to Ksh486 million in June this year from Ksh406m in June last year. It’s earnings per share, increased by 31 per cent, from Ksh1.03 per share last year to Ksh1.35 for the year ending June 2013.
Uchumi is expected to set competition with Nakumatt- another Kenyan chain store that has already established it footprint with two stores in the Kigali market.