Africa-Press – Kenya. Investors trooped back to the CIC Insurance Group Plc counter at the Nairobi Securities Exchange (NSE) following a dramatic sell-off triggered by a surprise profit warning.
On Wednesday, the insurer posted a volume of 5.2 million, the second highest in the year, to 6.45 million achieved on January 27.
The insurer’s share price, which plunged sharply after the announcement, has begun to attract bargain hunters and cautious long-term holders, even as market participants digest the implications of the company’s earnings outlook and the broader impact of tech-driven trading platforms.
A spot check of the Nairobi bourse by the Star via Ziidi App on Wednesday afternoon shows that CIC share trading at Sh5.26, having gained nearly five per cent after plunging to an all-time low on Tuesday.
The Insurer’s CIC stock closed at Sh5.04 on Tuesday, marking a 17.9 per cent plunge from the previous close of Sh6.14 — the largest single-day decline in recent months.
Market data show the counter traded as low as Sh4.59 during the session, underscoring the volatility that gripped the insurer’s share.
The steep fall wiped out significant market value in a single day. With roughly 2.88 billion shares issued, the near-18 percent decline translated into billions of shillings in paper wealth evaporating as traders rushed for the exits.
Analysts estimate that investors collectively saw upwards of Sh3.5 billion wiped off CIC’s market capitalisation on the profit-warning day alone.
An unexpected profit warning issued late last week triggered the sell-off. In a regulatory filing, CIC disclosed that its net profit for the year ended December 31, 2025, is now expected to fall by at least 25 per cent to around Sh2.14 billion, down from Sh2.85 billion in 2024.
Management cited two key drivers behind the profit downgrade: the non-recurrence of a one-off Sh1 billion gain from land revaluation booked in 2024, and elevated insurance claims across its portfolio, which have squeezed core underwriting margins.
“The absence of significant fair value gains, coupled with rising claims costs, materially alters the earnings landscape for 2025,” the directorate said in a statement to shareholders.
The decline came just a week after the firm announced it had made a Sh1.8 billion capital injection into its balance sheet following two major land sales, which have boosted its cash position.
It had sold a 50-acre block neighbouring Tatu City and 100 acres in Kajiado, with proceeds aimed at enhancing the insurer’s capital position, as the Insurance Regulatory Authority (IRA) heavily discounts land assets, preferring liquid assets for claim settlements.
The announcement saw the share price rise by close to 10 per cent on the eve of Valentine’s Day, hitting Sh5.52, recording a 9.1 per cent gain over its previous closing price of Sh5.06.
Market watchers say the plunging price was compounded by the proliferation of the Ziidi Trader app — a new mobile-based trading platform integrated into M-Pesa that allows users to buy and sell NSE shares in real time without a traditional brokerage account.
Launched in early February, Ziidi has dramatically lowered barriers to entry for retail investors, enabling quick access to listed equities and real-time settlement.
“With the click of a button on Ziidi, retail investors were able to exit their positions as soon as the profit warning hit the wires,” said Michelle Otieno, a Nairobi-based equities strategist.
“This immediacy — combined with fear of further losses — accelerated the sell-off more than traditional broker-mediated trades would have.”
Another analyst, John Kamau of a local brokerage, noted: “Ziidi has shifted the psychology of trading. Investors used to the slower, broker-facilitated process now react instantly to news, which can magnify volatility — for better or worse.”
Indeed, market data show that Ziidi accounted for a large portion of NSE deal counts in the days following its rollout, with daily trades reaching record highs as first-time investors joined the market.
Despite the sell-off, some institutional players and long-term holders see the price dip as an opportunity.
“CIC’s fundamentals outside the one-off items are intact,” said a senior analyst at a Nairobi fund management firm who spoke on condition of anonymity. “The profit warning was more about accounting recognition than operational collapse.”
He adds that shareholders can be optimistic about CIC, knowing the stock has accrued 16 per cent over the past four-week period—15th best on NSE. “It is the 12th most traded stock on the bourse over the past three months.”
