The Week In Review: Kazakhs merit a risky buy

Kazakhmys floated only last month, but next week it will join the FTSE 100 index of Britain's biggest companies. Privatised by the Kazakhstan government in stages after 1992, the company has 16 copper mines across three regions of the country.

Kazakhstan is oil rich and mineral rich, and one day will simply be rich. For now, it is among the lowest-cost places to mine. Kazakhmys is investing in new capacity and is expected to boost production by 50 per cent over eight years. Good relations with the government should mean opportunistic acquisitions on top of this.

The list of risks should put most people off. Mining is dangerous, and production can be lost due to accidents or technical difficulties. In addition, Kazakhstan, despite having been spared the ethnic violence of other countries in this region, is still a flawed democracy whose privatisations are widely resented.

Still, Kazakhmys is paying a market-average dividend, which mitigates some of the risks. For long-term, risk-hungry investors with cash to spare, buy.

PERSIMMON

Persimmon will become the UK's biggest housebuilder when it completes the £643m acquisition of Westbury. Persimmon is one of the most diverse of the housebuilders, both geographically and by type of home. But it has avoided too great a concentration on city apartment blocks, where the market appears somewhat rickety. Hold.

GREENE KING

Unlike other pubs groups, which have lamented the consumer slowdown, Greene King is upbeat. It expects a strong Christmas period, which should also benefit from the relaxation of licensing hours. After a 23 per cent rise in first-half profits before tax and one-off items to £55.8m, and trading at about 12 times 2006 earnings, the stock is cheap compared with its peers. Buy.

API

Packaging is not highly profitable and even a dynamic new management team at API has struggled. After forecasts were downgraded in the autumn, profits for the year to 30 September still came in below the house broker's prediction this week. There has been progress on improving margins. But the latest results have been poleaxed by the Chinese tobacco industry, to which it supplies foil for cigarette packets. Investors are ruing the rejection of a 200p-a-share bid earlier this year. Avoid.

ABERDEEN

Aberdeen Asset Management, can look back on 2005 with pride. The group, brought low by the scandal surrounding split-capital investment trusts, has been reshaped as "the fund manager's fund manager". Thanks to the £265m acquisition of Deutsche Asset Management, Aberdeen is one of the best-balanced fund managers on the stock market. Buy.

HELPHIRE

Helphire has tied up a string of deals with insurance companies that offer replacement hire cars as part of their cover. So far, 40 per cent offer such a service, and Helphire reckons another 40 per cent are talking to replacement car-hire operators such as it. Meanwhile, the purchase of Albany last year has taken Helphire further into personal injury claims management and the organisation of vehicle repair, both lucrative areas. Hold.

RBS

Royal Bank of Scotland was highly rated for a time following its acquisition of NatWest in 2000, but meeting expectations may often no longer be quite good enough. Despite solid results this week, the shares remain lowly rated. But almost every sector analyst still rates the shares a bargain. Buy.

ALEA

Alea, the Bermuda and London-based reinsurer, ran out of capital this summer and failed to persuade investors to give it more. It has spent the last few weeks selling off the remaining parts of its active business. As the company moves towards wind-up, money will be handed back to shareholders - compensating for the inevitable crumbling of the company's share price. But working out the true valuation is tricky. Avoid.

COMPUTERLAND

From a distance, Computerland UK's interim results do not look particularly impressive. The IT services group registered a 30 per cent slump in pre-tax profits to £800,000 and a 10 per cent fall in sales. But shareholders should not despair. By far the group's biggest division sees it offer organisations with a one-stop shop for their IT needs. This side of the business has registered growth in every one of the last 12 quarters and there is no reason to think this trend will not continue Buy the shares.

The above are recommendations from the daily Investment Column.

Shareholder friendly HBOS on song with big 2005 profits

Those of a sensitive disposition should avoid their TV for the foreseeable future. This week's stonking trading update from HBOS has given Howard, the cheesy bank manager from its adverts, something else to sing about.

The H in HBOS is Halifax, the UK's biggest mortgage lender; the BOS is Bank of Scotland. Across the group, stronger sales of insurance and investment products are offsetting the slower mortgage market. And the company's costs are among the industry's lowest. Profits this year will exceed City expectations.

HBOS has mounted a strong challenge to the Big Four high-street banks in current accounts and lending to business. But some in the City have begun to question where future growth will come from. HBOS has few operations abroad, but has been building up its international division.

You can trust its chief executive James Crosby to keep running a tight ship. Rather than spend big on expansion, he has given £910m back to shareholders so far this year, via a share buy-back scheme that boosts the share price. He plans to hand back £750m more next year. Plus dividend yield stands at about 4 per cent.

Shareholders after a safe investment likely to deliver solid income without too many frights need look no further. Buy.

s.foley@independent.co.uk
News
A 1930 image of the Karl Albrecht Spiritousen and Lebensmittel shop, Essen. The shop was opened by Karl and Theo Albrecht’s mother; the brothers later founded Aldi
people
Arts and Entertainment
Standing the test of time: Michael J Fox and Christopher Lloyd in 'Back to the Future'
filmA cult movie event aims to immerse audiences of 80,000 in ‘Back to the Future’. But has it lost its magic?
Arts and Entertainment
Flora Spencer-Longhurst as Lavinia, William Houston as Titus Andronicus and Dyfan Dwyfor as Lucius
theatreThe Shakespeare play that proved too much for more than 100 people
News
exclusivePunk icon Viv Albertine on Sid Vicious, complacent white men, and why free love led to rape
PROMOTED VIDEO
Arts and Entertainment
Stir crazy: Noel Fielding in 'Luxury Comedy 2: Tales from Painted Hawaii'
comedyAs ‘Luxury Comedy’ returns, Noel Fielding on why mainstream success scares him and what the future holds for 'The Boosh'
Life and Style
Flow chart: Karl Landsteiner discovered blood types in 1900, yet scientists have still not come up with an explanation for their existence
lifeAll of us have one. Yet even now, it’s a matter of debate what they’re for
Arts and Entertainment
'Weird Al' Yankovic, or Alfred Matthew, at the 2014 Los Angeles Film Festival Screening of
musicHis latest video is an ode to good grammar. But what do our experts think he’s missed out?
Sport
New Real Madrid signing James Rodríguez with club president Florentino Perez
sportColombian World Cup star completes £63m move to Spain
Travel
Hotel Tour d’Auvergne in Paris launches pay-what-you-want
travelIt seems fraught with financial risk, but the policy has its benefits
Arts and Entertainment
booksThe best children's books for this summer
Life and Style
News to me: family events were recorded in the personal columns
techFamily events used to be marked in the personal columns. But now Facebook has usurped that
Finacial products from our partners
Property search
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    Programme Director - Conduct Risk - London

    £850 - £950 per day: Orgtel: Programme Director - Conduct Risk - Banking - £85...

    Business Analyst (Agile, SDLC, software)

    £45000 - £50000 Per Annum + excellent benefits: Clearwater People Solutions Lt...

    Finance Manager - Bank - Leeds - £300/day

    £250 - £300 per day + competitive: Orgtel: Finance Manager - Accountant - Bank...

    Compliance Officer - CF10, CF11, Compliance Oversight, AML, FX

    £100000 - £120000 per annum + BONUS + BENEFITS: Harrington Starr: A leading fi...

    Day In a Page

    Noel Fielding's 'Luxury Comedy': A land of the outright bizarre

    Noel Fielding's 'Luxury Comedy'

    A land of the outright bizarre
    What are the worst 'Word Crimes'?

    What are the worst 'Word Crimes'?

    ‘Weird Al’ Yankovic's latest video is an ode to good grammar. But what do The Independent’s experts think he’s missed out?
    Can Secret Cinema sell 80,000 'Back to the Future' tickets?

    The worst kept secret in cinema

    A cult movie event aims to immerse audiences of 80,000 in ‘Back to the Future’. But has it lost its magic?
    Facebook: The new hatched, matched and dispatched

    The new hatched, matched and dispatched

    Family events used to be marked in the personal columns. But now Facebook has usurped the ‘Births, Deaths and Marriages’ announcements
    Why do we have blood types?

    Are you my type?

    All of us have one but probably never wondered why. Yet even now, a century after blood types were discovered, it’s a matter of debate what they’re for
    Honesty box hotels: You decide how much you pay

    Honesty box hotels

    Five hotels in Paris now allow guests to pay only what they think their stay was worth. It seems fraught with financial risk, but the honesty policy has its benefit
    Commonwealth Games 2014: Why weight of pressure rests easy on Michael Jamieson’s shoulders

    Michael Jamieson: Why weight of pressure rests easy on his shoulders

    The Scottish swimmer is ready for ‘the biggest race of my life’ at the Commonwealth Games
    Some are reformed drug addicts. Some are single mums. All are on benefits. But now these so-called 'scroungers’ are fighting back

    The 'scroungers’ fight back

    The welfare claimants battling to alter stereotypes
    Amazing video shows Nasa 'flame extinguishment experiment' in action

    Fireballs in space

    Amazing video shows Nasa's 'flame extinguishment experiment' in action
    A Bible for billionaires

    A Bible for billionaires

    Find out why America's richest men are reading John Brookes
    Paranoid parenting is on the rise - and our children are suffering because of it

    Paranoid parenting is on the rise

    And our children are suffering because of it
    For sale: Island where the Magna Carta was sealed

    Magna Carta Island goes on sale

    Yours for a cool £4m
    Phone hacking scandal special report: The slide into crime at the 'News of the World'

    The hacker's tale: the slide into crime at the 'News of the World'

    Glenn Mulcaire was jailed for six months for intercepting phone messages. James Hanning tells his story in a new book. This is an extract
    We flinch, but there are degrees of paedophilia

    We flinch, but there are degrees of paedophilia

    Child abusers are not all the same, yet the idea of treating them differently in relation to the severity of their crimes has somehow become controversial
    The truth about conspiracy theories is that some require considering

    The truth about conspiracy theories is that some require considering

    For instance, did Isis kill the Israeli teenagers to trigger a war, asks Patrick Cockburn