Analysts Expect Cagey Mop up of Stocks as Euphoria of MTN Nigeria Listing Persists

By Modupe Gbadeyanka

The eventual listing of MTN Nigeria Communications Plc shares on the trading platform of the Nigerian Stock Exchange (NSE) last week brought back ‘sanity’ to the exchange.

For three weeks, the local bourse had been underwater for three consecutive weeks, with investors waiting for the catalyst to trigger an upward trend without success until last Thursday, when the telco listed over 20 billion units of its stock.

Though the market closed marginally by 0.1 percent week-on-week, the euphoria about the exercise, which was done by introduction, is expected to keep the momentum at the green territory.

“In the new week, we expect the local equities market to close marginally in green territory as the euphoria of the listing of the telecoms giant is likely to be sustained.

“More so, we expect investors to take advantage of the general low share prices in the market, especially in the banking sector, in order to maximize their returns,” analysts at Cowry Asset posited.

Sharing a similar view were analysts at United Capital Research, who “expect the listing of MTNN shares on the exchange to keep sentiments upbeat as investors continue to scramble to get a piece of the telco.”

“We expect to see increased investors’ appetite for the MYN Nigeria stock particularly in the early days of the week and bargain hunting in fundamentally sound stocks for the short term gains.

“We therefore maintain a bullish outlook for the market in the near-term,” analysts at Afrinvest said in their report.

In the same vein, analysts at Vetiva said, “MTN Nigeria remains the sole market catalyst, driving market to its highest gain since February 12, 2019.

“We expect market to close positive today as the index continues to rally on the back of the new listing.”

As for analysts at Business Post, “We expect the market to sustain the ecstasy of the MTN Nigeria listing.

“We are also of the view that smart investors will take advantage of the rush for MTN Nigeria shares to mop up fundamentally sound stocks being dumped by some market players for the purchase of the newest NSE darling.

“At the end, the market will gain from this situation as the index will further appreciate at the close of the week, with foreign portfolio investors making a return into the market.

“We also see holders of MTN Nigeria shares still refusing to sell to buyers so as to push the price further higher to a certain level they feel is right to offload.”