The hottest show in Kenya takes place every weekday morning in a dark auditorium on the first floor of a central office block in the capital.

There is a mad rush for seats when the doors open at 10.30am. Sharp-suited businessmen jostle with taxi drivers wearing hand-me downs; women with sleek mobile phones squeeze in next to farmers from the countryside.

All eyes are fixed on the white screen at the front. A huge spreadsheet appears, packed with numbers that slowly change. Geoffrey Wachira, a 27-year-old moneychanger, smiles. "My shares are up again," he whispers.

Kenya has gone share crazy. The incredible performance of the Nairobi Stock Exchange (NSE) - which is next to the public auditorium and provides the live share-price feed - is the talk of the country. From 2002 to 2007, the main NSE index rose 787% in dollar terms, according to Standard & Poor's, the investment research firm, making it one of the world's best-performing markets.

Jimnah Mbaru, the NSE chairman, said: "We have several stock market billionaires [1bn shillings equals £7.2m]. We've stopped counting the multimillionaires."

Stories of overnight wealth creation have created a huge frenzy for shares from people who have never invested in the stock market before. When KenGen, the state's biggest electricity company, listed its shares last year, there were queues at brokerages all over the country. Local media reported how small-scale farmers were selling their cattle to buy the shares. Banks suddenly offered "share loans" to people who had been considered unworthy of credit.

The KenGen offer was more than three times oversubscribed, and 70,000 people were allocated shares. The price quadrupled on the first day of trading. Demand for a stake in last year's other big listings - including Eveready, the battery maker, and Scanad, an advertising company - also dwarfed supply. By the end of the year, 15bn shillings of new money had poured into the market, and the index had risen 60%.

The Kenya Association of Stockbrokers said the success of the new listings meant that close to a million Kenyans now owned shares. Amish Gupta, chairman of the association, said: "Suddenly we have got the mass market buying stocks, not just the elite." Most new investors today are aged between 22 and 40, he added. "Savvy men and women looking for quick returns."

The NSE's resurgence began towards the end of the notoriously corrupt era of Daniel arap Moi. When it became clear he would hand over power peacefully in December 2002, the NSE 20 index of leading shares emerged from a nine-year bear market. From a low of 1,000 points, it more than doubled in President Mwai Kibaki's first year in power.

Stabilised

A sound economy has kept the trend pointing skywards. Growth has been steady at about 5% a year. Interest rates have dropped and inflation stabilised. Tax collection has nearly doubled. The Kenya shilling has appreciated against the dollar. And vast sums of money have poured in from the diaspora; not just to sustain families, as before, but also to invest, helping the NSE index burst through 6,000 points for the first time.

The buzz about the stock market is seen online, where numerous blogs are now devoted to the bull market, and at the exchange itself. As red-jacketed traders sat hunched over their computer screens, Mr Wachira emerged from the public gallery. His turn was over: demand for seats is so great that a new audience is allowed in every hour.

When he and his wife, Patricia, a fruit vendor, had first managed to save some money they bought a plot of land. But their friends were making far better returns by playing the stock market. So last June they started buying shares and so far have made 50,000 shillings profit (£360) - nearly twice his monthly wage.

Mr Wachira's story is typical of the shifting attitudes towards investment in Kenya. Historically, most people with spare cash kept it under the mattress. Wealthier individuals bought livestock, opened a stall selling clothes or mobile phones, bought a matatu minivan taxi or, most popular of all, purchased property.

Professor Chege Waruingi, chairman of the Capital Markets Authority, which oversees the NSE, said: "The whole value system here is changing fast. Younger people no longer feel they have to purchase land to prove their worth."

Mr Waruingi said the stock exchange still needed reform. The NSE was still too much of an old boys' club, he said, as most of the big money was still being made by a select few well-connected investors. The market also lacks transparency and liquidity - only 50 companies are listed. He is urging the government to sell more of its holdings in mature companies to boost the secondary share market.

Aly-Khan Satchu, a Kenyan who worked in finance in the City of London for 20 years and has just published a book about investing in the NSE entitled Anyone Can Be Rich, agrees that this is the way forward. He equates the Kenyan government's decision to sell off state assets such as KenGen and the telephone company Telkom, due to be listed this year, with Margaret Thatcher's privatisation drive in the UK during the 1980s, when nationalised industries such as British Telecom and British Gas went public, dramatically widening share ownership.

"These new shares are being issued at a discount, so the investors are happy," said Mr Satchu, who claims to be making more money investing locally than he ever did as a City high-flyer. "And the government is turning loss-making investments into revenue. It's a win-win situation for the country."

While he is particularly optimistic about Kenya, he believes that stocks across much of the continent may be undervalued. All of the sub-Saharan African stock market indices monitored by Standard & Poor's, including Zimbabwe, Ghana, Botswana and Nigeria, have more than doubled in dollar terms since 2002 - a feat unmatched by the US or British markets.

Undervalued

Not everyone is convinced that the Kenyan boom can carry on. Rob Shaw, a local economic analyst, said the market had reached a bubble stage. But try telling that to Simon Mwangi, 49, an informal trader with dusty shoes, a faded yellow shirt and an old baseball cap who was in the public gallery the other day. He was checking up on the 200 Eveready shares he bought during the company's flotation last year. "So far, so good," he said. - Source: The Guardian, London