The Chief Executive Officer, Nigerian Exchange Limited (NGX), Mr. Temi Popoola has disclosed that BUA Foods Plc, Geregu Power Plc, among other new listings contributed over 10 per cent to market capitalisation in the past two years.
In 2022, the listing of BUA Foods and Geregu Power added N720billion and N250billion to the market capitalization, respectively. The likes of Nigeria Infrastructure Debt Fund contributed N92.53billion and VFD Group added over N45 billion to the market capitalisation of NGX this year.
According to him, “We have had notable listings within the last two years including BUA Foods, Geregu – which is our first power sector listing, MeCure Industries, VFD Group, and interestingly our first listed Investment Trust, Nigeria Infrastructure Debt Fund.”
This underscores NGX’s growing prominence as a preferred destination for corporate listings and capital raising.
Speaking at the MTN Capital Markets Day in Abuja, Popoola, addressing the global challenge faced by exchanges with increasing delistings, said “There has been quite a bit of news lately about delistings in our market, and that is a trend we are seeing not just in Nigeria but on major exchanges globally. Take Johannesburg, for instance; it has been struggling with delistings.”
Globally, Initial Public Offerings (IPOs) have witnessed a slowdown of more than 60per cent in the last two years, according to market data provider PitchBook.
Additionally, there has been a noticeable scarcity of smaller cap stocks on public exchanges due to various factors such as voluntary and involuntary delistings, mergers and acquisitions, and liquidations.
Popoola commented on this shift of capital from public markets to private ones, especially among smaller companies.
He emphasized NGX’s strategy to replace delistings faster than they occur. “What most exchanges aim to do is replace those delistings faster than they occur, and that has formed the crux of our strategy at NGX.
Addressing potential solutions, Popoola stressed the significance of government advocacy and policymaking. Drawing on historical examples, he highlighted the transformative impact of government interventions through policy changes, citing the banking sector and pension reforms of 2004 as notable instances that have positively influenced market growth.
“As NGX continues to position itself as a dynamic and resilient exchange, the commitment to proactive strategies and collaboration with government initiatives remains at the forefront”, Popoola noted.
Meanwhile, positive sentiments remained to the stock market yesterday as investors took positions in BUA Cement Plc and 38 others.
This led to the NGX All-Share Index (ASI) gaining 173.62 basis points or 0.25 per cent to close at 71,014.34 basis points. Also, market capitalisation gained N113 billion to close at N39.054 trillion.
As measured by market breadth, market sentiment was positive, as 39 stocks gained relative to 19 losers. Oando and Omatek Ventures emerged the highest price gainer of 10 per cent each to close at N11.55 and 77 kobo respectively, while MeCure Industries followed with a gain of 9.92 per cent to close at N5.21, per share.
C&I Leasing rose by 9.87 per cent to close at N4.12, while Meyer appreciated by 9.73 per cent to close at N3.27, per share. On the other side, SCOA Nigeria led others on the losers’ chart with 9.68 per cent to close at N1.12, per share. Sovereign Trust Insurance followed with a decline of 8.82 per cent to close at 31 kobo, while Cornerstone Insurance declined by 4.83 per cent to close at N1.38, per share.
Cadbury Nigeria lost 4.17 per cent to close at N13.80, while AIICO Insurance depreciated by 4.05 per cent to close at 71 kobo, per share.
The total volume traded decreased by 9.2 per cent to 297.35 million units, valued at N6.16 billion, and exchanged in 6,172 deals. Transactions in the shares of Oando led the activity with 27.967 million shares worth N315.268 million. AIICO Insurance followed with account of 23.043 million shares valued at N16.392 million, while Japaul Gold & Ventures traded 20.377 million shares valued at N38.355 million.
Transnational Corporations (Transcorp) traded 14.533 million shares worth N88.344 million, while Consolidated Hallmark Insurance traded 14.174 million shares worth N14.547 million.