Dangote Cement Plc, MTN Nigerian Communications Plc, Nestle Nigeria Plc, Airtel Africa Plc and Guaranty Trust Bank Plc closed 2019 as the top five most capitalised stocks on the Nigerian Stock Exchange (NSE). The five stocks, along with five others accounted for 74 per cent of the market capitalisation in 2019.
While the NSE All-Share Index (NSE ASI) fell by 14.5 per cent, market capitasation increased by 10.5 per cent to N12.958 trillion following the listing of MTN and Airtel Africa Plc. An analysis of the market capitalisation showed that Dangote Cement Plc remained the number one with N2.419 trillion, followed by MTN with N2.142 trillion. Nestle Nigeria Plc accounted for N1.165 trillion, while Airtel has N1.123 trillion market capitalisation. Guaranty Trust Bank Plc closed with N874 billion.
Zenith Bank Plc accounted for N584 billion, while Nigerian Breweries Plc and Stanbic IBTC Holdings Plc accounted for N468 billion and N410 billion respectively. Seplat Petroleum Development Company Plc and United Bank for Africa Plc ended the year with N363 billion and N235 billion in that order. The 10 stocks account for 74 per cent of the market capitalisation.
Market analysts said although Dangote Cement Plc remains the most capitalisation stock on the NSE, MTN might take over if the cement company decides to reduce its share through a share buy-back programme.
Dangote Cement Plc has proposed to its shareholders to approve a share buy-back programme that will enable it buy 10 per cent of its paid-up shares.
Going by the proposal, which is expected to be approved at an extra-general meeting (EGM) on January 22, Dangote Cement Plc will buy about 1,704,050,741 shares. These shares will be cancelled 10 days after acquisition. This will consequently reduce the outstanding shares of Dangote Cement to 15,336,456,664, from the current 17,040,507,405 shares.
According to Dangote Cement, the programme is in line with the company’s corporate strategy to improved its return on equity, and shareholder value in order to future long term growth.
“The relevant shares will be repurchased out of the profits of the company and any such number of shares bought under the programme is required to be cancelled in accordance with the Securities and Exchange Commission (SEC) rules and the NSE rule book which will consequently lead to a reduction in issued share capital,” the company said.
Dangote Cement Plc has been adding value to shareholder value, paying dividend regularly. For instance, it paid N16 dividend per share for 2018 financial.