COVID-19: FBNQuest Identifies Sectors to Benefit from Lockdown


Goddy Egene

As the world economy continues to suffer the impact of the COVID-19, FBNQuest Research has identified companies that would emerge from the crisis stronger.

According to FBNQuest, mobile telephony is a winner in the midst of the challenges brought by the COVID-19 and lockdown of many economies. This implies that in Nigeria, MTN Nigeria Communications Plc and Airtel Africa Plc are favoured.

FBNQuest said Amazon has made itself very useful by transporting medical supplies on behalf of governments (such as the United Kingdom).

“As we sit at home under varying degrees of lockdowns, it delivers the orders that some of us would previously have fulfilled by visiting stores. Mobile telephony is another winner as we are obliged to make use of conference calls and video conferencing for routine conversations with colleagues and clients that we often held face-to-face in the office. The handful of United States corporations capitalised at more than $100 billion (led by Alphabet, Amazon, Apple and Facebook) are set to grow in influence and reach. It will be more difficult for governments to rein them in on the grounds of their perceived monopolistic practices or poor conduct such as failing to close down terrorist or socially harmful sites,” it said.

Another area is the banking sector as the research said: “e-banking has received a boost from our being confined to our homes. The loser is likely to be cash transactions for health reasons and for practicality. We may well maintain the habit of paying for goods and service by card. The Central Bank of Nigeria (CBN) cash-lite and financial inclusion programmes appear healthier in this light.”

FBN Quest explained that the oil sector was another area the current trend would impact.

“Governments of oil producers have to adjust with fiscal retrenchment too, Nigeria being one of many examples. Developed countries may be tempted to adjust but have signed treaties and made policy pledges in the name of renewables. The cost of filling up the tank has nosedived where pricing is set by the market. Those segments of the airline industry that survive will feel that, once government closures of airports are lifted, they will be able to rebuild their businesses,” it said.

Meanwhile, trading at the stock market closed on a bullish note yesterday as the Nigerian Stock Exchange (NSE) All-Share Index (ASI) appreciated by 0.1 per cent to close at 21,121.20. The total volume of trades increased to 65.4 per cent to 255.59 million units, valued at N2.86 billion and exchanged in 4,418 deals. Zenith Bank Plc was the most traded stock by volume and value at 100.83 million units and N1.11 billion.