Economy
Airtel Africa to Boost NSE Market Cap by N1.4trn
**List Shares at N363 Per Unit
By Dipo Olowookere
Business Post has learned that Airtel Africa, the continent’s subsidiary of Indian company, Bharti Airtel, will list its shares on the floor of the Nigerian Stock Exchange (NSE) on Friday, July 5, 2019.
On Friday, June 28, 2019, the telecommunications company made its trading debut on the London Stock Exchange (LSE) after raising $750 million through its initial public offering (IPO).
However, at the close of trading yesterday, shares of the firm, which opened at 80 pence per share, settled at 67 pence a share, losing 16 percent of its value.
It was gathered by Business Post that when the shares of the company are admitted on the NSE next week, they would be sold at N363 each and should boost the market capitalisation by up to N1.4 trillion.
In an exchange filing on Friday, Bharti Airtel said it would offer Nigerian investors meaningful allocations after receiving subscriptions from investors from Asia, Europe, Middle East and others.
The company said it expects to have a free float in excess of 25 percent, as certain of the pre-IPO investors’ holdings will also constitute free float.
Commenting on the exercise, CEO of Airtel Africa Plc, Raghunath Mandava, stated that, “We are now the first telecom company to simultaneously list on the premium segment of the London Stock Exchange and Nigerian Stock Exchange through an IPO.
“We welcome our new investors and look forward to continuing to execute our strategy and deliver the growth opportunities across our markets in voice, data and mobile money.”
Mandava further said, “This is an exciting time for us. We are very pleased with the success of the initial public offering and welcome our new shareholders.
“The strength of our network and continued growth and evolution of the African telecoms sector has fuelled the demand for our shares.
“We have a strong track record operating in a fast-growing region. The markets we operate in have powerful and promising underlying macroeconomic and demographic trends, and we believe we are best placed to capitalise on this opportunity.
“We are delighted to give a broader range of investors access to the benefits of our in-depth knowledge of the markets we operate in. We have a clear strategy to continue growing and look forward to delivering it.”
Chairman of the firm, Sunil Bharti Mittal, noted that, “The strong support we have received from institutional investors demonstrates the attractive investment proposition Airtel Africa offers the market.
“Since first investing in Africa almost nine years ago, we have leveraged our expertise in emerging markets to deliver on a clearly defined strategy to build Airtel Africa into a market-leading mobile service provider, increasingly expanding beyond voice into data services and Airtel Money.
“The board would like to thank those involved in the process and looks forward to supporting the management team as they execute on the strategy.”
“With the recent equity investments into the business by globally recognised long-term investors, we believe that Airtel Africa is in a strong position to build its own capital market profile, allowing others to join us in a real business success story,” he added.
In February 2018, Bharti Airtel announced its intention to consider an IPO for the Africa business, using the net proceeds from the issue of new shares for the reduction of $4 billion net debt.
Airtel Africa has presence in 14 African countries, with 100 million customers across West Africa, East Africa and Central Africa, with Nigeria alone accounting for 36 percent of its total revenue.
The company provides telecommunications and mobile money services on the continent and serves a large and fast-growing addressable market, with attractive mobile data and mobile money growth prospects as non-voice revenue remains lower than other geographies.
Last month, its rival in Africa, MTN Nigeria Communications Plc, listed its shares on the NSE at N90 each and rose to nearly N160 per unit before plunging to N129.05k yesterday.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange recorded a 0.16 per cent decline on Tuesday, January 21, extending its loss this week to two.
This further depleted the market capitalisation of the alternative stock exchange by N1.65 billion at the close of transactions to N1.071 trillion from the N1.073 trillion it closed in the preceding session.
In the same vein, the NASD Unlisted Security Index (NSI) slid by 4.79 points to wrap the session at 3,100.33 points compared with 3,105.12 points recorded in the previous session.
The bourse ended with two price losers yesterday led by Geo Fluids Plc, which gave up 32 Kobo to trade at N4.38 per share versus Monday’s closing price of N4.70 per share and FrieslandCampina Wamco Nigeria Plc, which depreciated by 15 Kobo to close at N39.50 per unit compared with the previous day’s N39.65 per unit.
On the second trading day of the week, the number of deal carried out slightly went up by 8.3 per cent to 13 deals from the 12 deals executed at the previous trading session.
Also, the value of transactions increased by 97.2 per cent to N4.5 million from the N2.5 million recorded a day earlier, while the volume of securities traded in the session declined by 71.6 per cent to 183,780 units from the 767,610 units recorded on Monday.
FrieslandCampina Wamco Nigeria Plc remained the most traded equity by value (year-to-date) with 4.1 million units worth N162.9 million, followed by Geo-Fluids Plc with 9.1 million units valued at N44.0 million, and 11 Plc with 55,358 sold for N14.5 million.
Also, Industrial and General Insurance (IGI) Plc closed the day as the most active stock by volume (year-to-date) with 25.3 million units worth N5.9 million, trailed by Geo-Fluids Plc with 9.1 million units sold for N44.0 million, and FrieslandCampina Wamco Nigeria Plc with 4.1 million units valued at N162.9 million.
By Adedapo Adesanya
Pressure further mounted on the Nigerian Naira in the different segments of the foreign exchange market on Tuesday, making its value to shrink against the United States Dollar at the close of business.
In the Nigerian Autonomous Foreign Exchange Market (NAFEM), the domestic currency crashed against its American counterpart during the session by 0.18 per cent or N2.73 to settle at N1,552.78/$1, in contrast to Monday’s closing price of N1,550.05/1.
But against the Pound Sterling and the Euro, the local currency traded flat in the official market yesterday at N1,906.98/£1 and N1,613.48/€1, respectively.
As for the black market segment, the Naira weakened against the Dollar on Tuesday by N5 to sell for N1,670/$1 compared with the preceding day’s value of N1,665/$1.
Meanwhile, the cryptocurrency market heaved a sigh of relief during the session as President Donald Trump created a crypto task force dedicated to “developing a comprehensive and clear regulatory framework for crypto assets.”
The task force will be led by Commissioner Hester Peirce, a long-time advocate for the crypto industry, and will work closely with the crypto industry to develop regulations. This is after Mr Gary Gensler, an opponent of crypto, officially stepped down as chairman of the US Securities and Exchange Commission (SEC) after Mr Trump’s term started.
The task force will also work with Congress, providing “technical assistance” as it crafts crypto regulations.
Solana (SOL) recorded a 9.2 per cent growth to sell at $257.09, Dogecoin (DOGE) rose by 7.6 per cent to $0.36789, Ripple (XRP) added 4.0 per cent to finish at $3.18, and Bitcoin (BTC) increased by 3.7 per cent to $105,515.03.
Further, Binance Coin (BNB) appreciated by 2.8 per cent to close at $699.01, Cardano jumped by 2.1 per cent to trade at $0.9972, Ethereum (ETH) soared by 2.0 per cent to settle at $3,308.21, and Litecoin (LTC) went up by 1.5 per cent to end at $116.72, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) closed flat at $1.00 each.
By Adedapo Adesanya
The price of the Brent crude oil grade went below the $80 mark on Tuesday after it shed 86 cents or 1.1 per cent to trade at $79.29 per barrel after the US President, Mr Donald Trump, signaled the possibility of his country boosting its oil production.
This move raised concerns of higher US output in a market widely expected to be oversupplied this year, with the US West Texas Intermediate (WTI) crude futures falling by $1.99 or 2.6 per cent during the session to $75.89 per barrel.
On his first day in office, the US President signed an executive order to unleash America’s energy by easing the barriers to oil and gas extraction and production and revoking a series of climate orders by former President Joe Biden.
As pledged in the campaign, the executive order follows the declaration of a national energy emergency.
The declaration includes measures to expedite energy infrastructure delivery, and emergency approvals by agencies “to facilitate the identification, leasing, siting, production, transportation, refining, and generation of domestic energy resources, including, but not limited to, on Federal lands.”
This will likely confirm expectations that the oil market will be oversupplied this year after weak economic activity and energy transition efforts weighed heavily on demand in top-consuming nations the US and China.
President Trump also said he was considering imposing 25 per cent tariffs on imports from Canada and Mexico from February 1, rather than on his first day in office as promised.
The delay helped ease concerns of an immediate tightening of the market among US refiners, many of which are geared to process the type of crude oil supplied by these countries.
The US Energy Information Administration (EIA) reiterated on Tuesday its expectations for oil prices to decline both this year and next.
On its part, the Organisation of the Petroleum Exporting Countries (OPEC) projects robust demand growth in the world both this year and next.
In 2025, OPEC says demand is set to grow by 1.4 million barrels per day leaving its projection unchanged from the December report.
However, losses were also limited after the US president said his administration would “probably” stop buying oil from Venezuela. The U.S. is the second-biggest buyer of Venezuelan oil after China.
Also weighing on prices on Tuesday was the potential end to the shipping disruption in the Red Sea.
Yemen’s Houthis said on Monday they will limit their attacks on commercial vessels to Israel-linked ships provided the Gaza ceasefire is fully implemented.
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