Treasury Cabinet Secretary John Mbadi has defended the Ksh9 per share valuation for the Kenya Pipeline Company (KPC), describing it as a safe investment amid ongoing debates over the pricing.

Speaking in an exclusive interview on a local TV station on January 22, 2026, Mbadi explained the valuation process and the factors that informed the final price.

Valuation process explained

Mbadi said the pricing follows international financial reporting standards and involves a detailed assessment of the company’s assets and prospects. “You know, it’s a very complicated accounting process, because we use international financial reporting standards to value assets. So I will tell you that that has been done,” he noted.

Acknowledging differing opinions, the CS noted, “KPC’s price, there are also people who think it is underpriced or undervalued. But a lot of people also think it’s overvalued at nine shillings, a bit higher compared to the asset base.” He explained that valuing a company like KPC involves assessing profitability, cash flows, and the business environment.

“The company has been profitable for quite some time and clearly shows signs of continued profitability. Making 20% of revenue as a percentage of after-tax profit is not a mean achievement,” he said.

Diversification and revenue as key indicators

Mbadi highlighted KPC’s diversification into fibre optics as a major factor for its long-term potential.

“Secondly, the company has a future because, apart from transporting the petroleum products, you can see it is diversifying. You can see in fibre optics, it’s the biggest player. Many people don’t know that a lot of these, including Safaricom, use the fibre optics of KPC. So that is one indicator that it has a future. This is a company of tomorrow,” he said.

He also noted that KPC’s revenue structure makes it attractive to international investors. “Secondly, one of the reasons why you would find international investors shying away from investing in a company is when the business of that company is conducted largely in local currency. For KPC, it is the opposite. KPC’s revenue is largely in hard currency and that motivates the international players,” Mbadi explained.

Balancing local and international considerations

Mbadi emphasised the need to strike a balance between local and global markets when setting the share price so as not overvalue nor undervalue.

“But now you have to strike a balance. If you put the price too high because the international players would see nine shillings as a low price, then there is also the local market you have to think about. So we have to balance the two and arrive at a price that takes care, you don’t undervalue for one segment so much, and you don’t overvalue for another segment,” he said.

Reassuring potential investors, Mbadi concluded: “And nine shillings has been arrived at a very reasonable price. I am sure it is a price that, if you go to the market and buy shares, you will not regret. It is a safe way of investing your money.”