Stories by Goddy Egene
Investors on the NASD OTC Securities Exchange market are witnessing growth in their investment as the market recorded a gain in the first quarter (Q1) of 2019.
The feat was an extension of the growth recorded in 2018.
NASD OTC Securities Exchange is the approved market for unlisted public securities in Nigeria.
These are public companies not listed on the Nigerian Stock Exchange (NSE). There are currently 39 firms listed on the NASD OTC.
However, while the NSE equities market suffered a decline of 1.2 per cent in the Q1 of 2019, the NASD OTC appreciated 2.3 per cent as indicated by the Unlisted Securities Index.
In terms of market capitalisation, investors gained N30 billion in Q1 as it moved from N514.80 billion to N544.39 billion. This translated to about 5.8 per cent growth.
The NASD OTC market has been an opportunity for investors in unlisted securities to get liquidity and create wealth.
“Our mission is to provide liquidity and transparency for investors in secondary market for unlisted companies. NASD OTC Securities Exchange supports both bilateral and multilateral trades,” it said.
The management of NASD OTC has been making efforts to attracted more listings. Those efforts may yield fruits soon as the Securities and Exchange Commission (SEC) is equally introducing policies that would boost the listing efforts.
At the last Capital Market Committee (CMC) meeting, for instance, market operators advocated for the commission to take strong actions against company secretaries who aid the trading of shares of unlisted public company outside a SEC recognised platform as required by the law.
Also, the CMC has called for the extension of shares dematerialisation exercise to unlisted companies, which they say would enhance liquidity and ease market processes.
The Managing Director/Chief Executive Officer, NASD Plc, Bola Ajomale, recently said trading activities on the platform had increased tremendously during the period.
He said in the last three years, the platform recorded huge capital coming into the country in form of long-term investments, rather than trading capital.
“It is not money that came in and went out because they want to make returns, it was money that came in because they want to assist the company grow, so we have seen a lot of growth, and investment and as time goes on, this kind of investment we will seek to make dividend rather than to sell them when the exchange rate moves,” he said.
According to him, due to the investment growth witnessed in the past few years, the company decided to launch an enterprise portal- the NASD Enterprise Portal (NASDeP), to boost investment in small enterprises in Nigeria.
“In 2018, we launched three platforms, all of them fully indigenous, built by Nigerian enterprise, because we do have an industry that is growing. In addition, the three portals we have, one is a capital raise platform, which is the enterprise portal, the second is the trading platform, which allows brokers to trade from any part of the world at any time, using any devise,” he said.
Ajomale, said the NASDeP portal was designed specifically to address the information gap on start-ups and other growth enterprises and provides a central database of private investment opportunities and investor pools.