Stock Market Investors Count Gains Despite Bear Run


Goddy Egene
Some investors in the Nigerian stock market have been counting their gains since the beginning of the year despite the bearish trend that persisted for most past of first half of the year to June 30, 2016. The adverse economic climate characterised by declining oil prices, rising inflation, declining capacity utilisation and uncertainties around devaluation of the naira and the delay in the 2016 budget put the stock market under the strong grip of the bears in the first six months.

A late rally in June as a result of new Central Bank of Nigeria (CBN) flexible foreign exchange policy made the market to record a marginal gain of 3.2 per cent in the first six months of the year.

However, THISDAY checks showed that the bear run notwithstanding, investors in some of companies had a bountiful harvest in the first half of the year, counting gains as high as over 100 per cent.

Some investors, who invested at the beginning of the year recorded significant positive gains that are above inflation rate, showing positive returns on investments.
For instance, Dangote Flour Mills Plc fetched investors a return of 325 per cent between January and June 2016. The equity rose from below N1.00 to close at N4.71 per share.

Etranzact Plc fetched investors a return of about 97.3 per cent, while United Capital Plc recorded a gain of 89.3 per cent to put smiles on the faces of investors despite the challenging environment. A.G Leventis Nigeria Plc posted 64.5 per cent growth. Seplat Petroleum Development Company Plc recorded a growth of 62.5 per cent, while NEM Insurance Plc appreciated by 50 per cent.
Investors in Union Dicon Salt (UDS) Plc garnered 39.6 per cent as the company consolidated its diversification to the agriculture.

UDS recently became the core investor in the $100 million Alape Staple Crop Processing Zone (SCPZ) in Kogi State to replace Cargill, a United States based agro-industrial giant.
Chuka Mordi of UDS had said: “It is a remarkable opportunity to develop the agribusiness space in Nigeria from a fully indigenous perspective. We would accelerate the progress on the Kogi State project in the next few months. We are ready to move very quickly to site.”

United Bank for Africa Plc also put smiles on the faces of investors, delivering 39 per cent returns in the first half of the year. Other stocks that ended the half year with positive returns on investments included: Neimeth International Pharmaceuticals Plc (33.7 per cent); Eterna Plc (30.2 per cent); African Prudential Registrars Plc 929.3 per cent); Total Nigeria Plc (29.2 per cent); DN Meyer Plc (28.5 per cent); GTBank Plc (27.9 per cent); Champion Breweries Plc (26.1 per cent); International Breweries Plc, Academy Press Plc ( 25 per cent apiece) and Julius Berger Nigeria Plc (21.2 per cent).