Kenya Pipeline Company (KPC) has fixed its initial public offering price at KSh 9.00 a share, placing a valuation of about KSh 163.6 billion on the State-owned fuel transporter ahead of its expected March listing on the Nairobi Securities Exchange.
The pricing points to an enterprise value of roughly KSh 150.6 billion, based on an EV to EBITDA multiple of 8.1 times applied to the company’s FY2025 performance, as outlined in the Information Memorandum. Under the offer, the government will offload a 65 percent stake, raising an estimated KSh 106.3 billion for the National Treasury through the sale of 11.81 billion shares. After the IPO, total shares in issue will stand at 18.17 billion.
At this valuation, Kenya Pipeline will debut as one of the largest companies on the NSE by market capitalisation, underlining its status as the country’s sole operator of the refined petroleum pipeline network and one of the more consistently profitable State-owned enterprises.
According to the disclosure document, the offer price was determined primarily using an earnings-based approach, with EV to EBITDA as the key benchmark. Kenya Pipeline posted EBITDA of KSh 18.59 billion for the year ended June 30, 2025, which, when multiplied by the implied 8.1 times multiple, yields the stated enterprise value. Asset-based and income-based methods were used as sense checks rather than price drivers.
The difference between enterprise value and equity valuation reflects the firm’s balance sheet strength. With relatively low debt and strong cash generation, enterprise value sits below market capitalisation.
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On a pure equity basis, the IPO implies a price to earnings ratio of about 21.8 times, using FY2025 post-split earnings per share of KSh 0.4122. Net profit for the year came in at KSh 7.49 billion on revenues of KSh 38.6 billion, supported by regulated pipeline tariffs and steady demand for petroleum transport and storage, which the company says underpin predictable cash flows.
Dividends feature prominently in the investment narrative. For FY2025, Kenya Pipeline paid out KSh 5.9 billion, translating to a post-split dividend per share of KSh 0.347. At the offer price, this equates to a dividend yield of roughly 3.9 percent. The board said payout decisions factor in profitability, cash availability, capital expenditure needs, debt covenants and distributable reserves.
Structurally, the IPO is a pure offer for sale, with no new shares being issued. Kenya Pipeline will not receive any of the proceeds, all of which will go to the government as part of its FY2025/26 financing plan. After the sale, the National Treasury will retain a 35 percent stake, subject to a 24-month lock-in period.
The Information Memorandum does not include forward-looking earnings guidance, with valuation anchored on FY2025 results. Trading is expected to commence on March 9, 2026, subject to regulatory approvals and completion of the offer process. Following listing, Kenya Pipeline will transition out of the State Corporations Act regime and operate as a publicly listed company under Capital Markets Authority and NSE disclosure requirements.
