Naivas’ net profit for the financial year ended June 2026 increased by 41.7 percent to Sh3.37 billion or 1.22 billion Mauritian rupees (MUR), highlighting the rising appeal of Kenya’s consumer market to investors seeking growth opportunities.
The net profit grew from Sh2.38 billion (MUR 861.69 million) posted in the previous year, continuing the trend of double-digit growth in the bottom-line. Net earnings were Sh1.66 billion (MUR 600.73 million) in the year ended June 2024.
Latest disclosures by Mauritian conglomerate IBL Group, which leads a consortium that owns a majority stake in Naivas, show the retailer’s sales grew by 11 percent to Sh123.66 billion (MUR 44.74 billion) during the review period from Sh111.34 billion (MUR 40.28 billion) in the previous year.
The results point to a retail market that has regained its appeal after the collapse of Nakumatt and Tuskys, the scale-down of Uchumi Supermarket and the exit of foreign chains Shoprite and Choppies.
Naivas, Quickmart and Carrefour have since stepped up expansion, competing for shoppers and prime locations as the sector consolidates around better-capitalised operators.
This has widened competition for market share across major urban centres. IBL owns an indirect stake of 37.33 percent in Naivas, held through an investment vehicle known as Mambo Retail, which is co-owned with French fund Proparco and German fund DEG.
The Mauritian conglomerate is among the institutional investors betting on Kenya’s growing retail market.
The investment appetite is also evident in Quickmart’s planned listing on the Nairobi Securities Exchange (NSE) this week, following an initial public offering (IPO) that raised Sh18.4 billion against a target of Sh15 billion.
The Quickmart offer was 122.7 percent subscribed, with foreign investors bidding for Sh3.57 billion worth of shares, nearly three times their Sh1.2 billion allocation.
Adenia Partners, a private equity firm in Quickmart, welcomed new institutional investors including 337 Frontier, World Bank Group’s International Finance Corporation (IFC) and RWC Asset Management.
Besides Naivas, other retailers have also been posting growth in revenue and profit. Carrefour Kenya, which is operated by Dubai-based conglomerate Majid Al Futtaim, last year grew its revenues by 13.7 percent to 1.386 billion United Arab Emirates Dirham (AED) from AED 1.219 billion (Sh42.95 billion) in 2024.
Over the same period, Quickmart reported a 33 percent growth in net profit to Sh1.51 billion as sales rose by 9.3 percent to Sh50.43 billion, with the firms paying of 80 percent of profits as dividends.
The retailer projects sales to hit Sh58.2 billion this year and Sh67.4 billion next year as it continues to expand. The top retailers have been on expansion journey, with Naivas closing June this year with 114 branches, up from 108 in a similar period last year. Quickamart plans to add five stores this year to hit 73 and add 10 next year.
“In Kenya, Naivas, which now operates 114 stores, further consolidated its market leadership, with growth from both existing and new stores across all major categories, supported by continued operational improvements,” says IBL in the latest annual report.
“Naivas will build on its expanding footprint, while leveraging its new ERP [Enterprise Resource Planning] platform to improve coordination across its operations.”
The retailer’s sales have been growing, with the latest revenue being more than double the Sh54 billion booked in 2020. Expenses rose by 10.4 percent to MUR 43.52 million during the review period. The sector’s expansion is unfolding alongside a shift in ownership and management as supermarket chains seek outside capital and professional leadership after governance failures contributed to the downfall of once-dominant local operators.
Naivas co-founder and managing director David Kimani stepped down at the end of October last year, ending the family’s direct leadership of the business. He was replaced by Andreas von Paleske, who had served as chief of strategy for eight years and became the retailer’s first non-family chief executive in its 35-year history.
The change reflects a growing recognition that scale alone does not guarantee survival in a business where thin margins, inventory management, supplier relationships and cash flow require tight controls.
Nakumatt and Tuskys had peak store networks of 65 and 64 outlets, respectively, before their collapse. Quickmart has identified governance as central to its expansion strategy.
Quicmkart said in its information memorandum the failure of local chains had been widely attributed to “weak corporate governance, overly aggressive expansion strategies and inadequate cost control”.
“In several cases, governance weaknesses reportedly extended to poor internal controls, resulting in pilferage and inappropriate supplier relationships that undermined financial discipline,” it added.
Foreign-owned operators faced a different set of challenges, including above-market rental commitments in premium locations that weakened price competitiveness and reduced customer traffic.
Some also relied on expensive expatriate managers with limited familiarity with local consumers, while offering product ranges tilted towards imported goods that were often more expensive and less suited to local preferences.
