Economy
How Businesses Can Leverage Stock Exchange to Scale
Soaring inflation and prolonged trading inactivity due to the global lockdown left businesses with huge inventories and a cash flow problem, which also disrupted funding pipelines.
Currently, large, medium, and small businesses are sourcing funds to get their businesses back on track and pursue their growth mandate as markets open gradually.
Absa, which offers investment banking and market products through various Nigerian registered subsidiaries, namely Absa Representative Office Nigeria Limited, Absa Capital Markets Nigeria Limited, and Absa Securities Nigeria Limited, advised local businesses to tap into the ample pool of retail and institutional investors on the stock exchange to drive their growth aspirations.
According to Akinkunmi Majaro, the Head of Absa Securities Nigeria Limited, “Businesses consistently strive to grow. Therefore, continued access to cash flow and other investment resources are crucial for businesses aiming to build the competitive edge necessary to drive growth.
“Meanwhile, the global health crisis and its fallout are strong indications that access to long-term financing with fewer stringent demands is critical to staying resilient in an austere operating environment.”
“The Nigeria Stock Exchange, especially, provides access to long and medium terms finance for structured businesses. Absa Capital Markets Nigeria Limited is positioned to help multinational and local businesses and a wide range of investors gain an overriding view of the capital market as well as guide investors and businesses in making wise investment and finance choices,” he added.
Businesses would need long-term access to finance to strengthen operating cash flow, drive product development initiatives, enhance logistics, expand product promotion coverage, penetrate new markets as well as scale operating capacity to the pre-COVID-19 levels.
The ability of these businesses to access funds readily would positively rub off on economic growth. It would revamp the employment generating capacity of the organised private sector and subsequently impact the gross domestic product level.
Many businesses default to bank loans when they are squeezed financially. But the stringent requirements by the banks and the high-interest rate on such loans remain a big challenge that small and medium businesses sometimes find hard to surmount.
Fluctuating currency exchange rates and inflation trends have further compounded SMEs’ ability to access cheap funding for their operations. It has therefore become apparent that businesses look beyond the commercial banks for their funding needs.
Traditionally, across the globe, capital markets offer an interesting opportunity for businesses that are looking to raise capital for medium to long term financing of their activities.
The stock exchange serves as a financial intermediary between investors and businesses listed on its floor. It is regarded as a trading crucible that links businesses to a large pool of local and foreign investors who are constantly searching for interesting investment opportunities.
These investors are anxious to boost their ROI and will put their monies in stocks that have favourable profit projections. The advantage for businesses on an exchange is that they can access large capital at a lower cost.
Businesses listed on the country’s stock exchange, like Stanbic IBTC, MTN Nigeria, and BUA Foods, among others have an advantage in terms of access to low-cost capital to expand their operations.
BUA Foods Plc’s 18 billion shares, for instance, were recently listed on the exchange at N40. The listing on the stock exchange provided a lever for the BUA Foods business to raise capital and deepen its operating capacity in the pasta, edible oil, sugar, and flour segments of the local food value chain as well as drive its export capabilities. While this move lifted the NGX Exchange (NGX’s) market capitalisation to N720 billion, it yielded a capital gain of 33 per cent for investors in the first week.
MTN Nigeria had a similar remarkable run in the first month of listing. Its shares appreciated from N99 to N129.45, yielding massive gains for investors while mopping up funds for the telecommunications giant to drive its network and mobile money expansion agenda.
Meanwhile, the finance opportunities available at the stock exchange are not restricted to large businesses. Structured small-medium enterprises need funding to navigate the teething challenges in the early growth stages.
Considering how the economy is holding up and the cautious approach of traditional lenders to small businesses, it is time for the segment to explore the capital market in a bid to access long-term finance to take advantage of emerging market opportunities. This is crucial for the survival of the segment.
In fact, there are tailored platforms that meet the capital needs of the SME segment on the floor of the stock exchange. The Growth Board on the NGX provides an alternative route for well-structured small businesses with the potential for growth to list on the exchange. Businesses of all sizes can list on the stock exchange to access cheap and long term tenured equity or capital from the capital market.
As businesses reopen fully for economic activities, and the Africa Continental Free Trade Agreement gathers pace, there is hardly a better time for businesses to access the opportunities available on the stock exchange to raise cheap long-term capital for their operations.
By Adedapo Adesanya
TotalEnergies EP Nigeria has signed a Sale and Purchase Agreement with Vaaris for the divestment of its 10 per cent non-operated interest in the Renaissance JV licences in Nigeria.
The Renaissance JV, formerly known as the SPDC JV, is an unincorporated joint venture between Nigerian National Petroleum Company Limited (55 per cent), Renaissance Africa Energy Company Ltd (30 per cent, operator), TotalEnergies EP Nigeria (10 per cent) and Agip Energy and Natural Resources Nigeria (5 per cent), which holds 18 licences in the Niger Delta.
In a statement by TotalEnergies on Wednesday, it was stated that under the agreement signed with Vaaris, TotalEnergies EP Nigeria will sell its 10 per cent participating interest and all its rights and obligations in 15 licences of Renaissance JV, which are producing mainly oil.
Production from these licences, it was said, represented approximately 16,000 barrels equivalent per day in company’s share in 2025.
The agreement also stated that TotalEnergies EP Nigeria will also transfer to Vaaris its 10 per cent participating interest in the three other licences of Renaissance JV which are producing mainly gas, namely OML 23, OML 28 and OML 77, while TotalEnergies will retain full economic interest in these licences, which currently account for 50 per cent of Nigeria LNG gas supply.
Business Post reports that the conclusion of the deal is subject to customary conditions, including regulatory approvals.
“TotalEnergies EP Nigeria has signed a Sale and Purchase Agreement with Vaaris for the sale of its 10 per cent non-operated interest in the Renaissance JV licences in Nigeria.
“Under the agreement signed with Vaaris, TotalEnergies EP Nigeria will sell to Vaaris its 10 per cent participating interest and all its rights and obligations in 15 licences of Renaissance JV, which are producing mainly oil. Production from these licences represented approximately 16,000 barrels equivalent per day in the company’s share in 2025.
“TotalEnergies EP Nigeria will also transfer to Vaaris its 10 per cent participating interest in the 3 other licenses of Renaissance JV, which are producing mainly gas (OML 23, OML 28 and OML 77), while TotalEnergies will retain full economic interest in these licenses, which currently account for 50 per cent of Nigeria LNG gas supply. Closing is subject to customary conditions, including regulatory approvals,” the statement reads in part.
The development is part of TotalEnergies’ strategies to dump more assets to lighten its books and debt.
By Aduragbemi Omiyale
The trading licence of Monument Securities and Finance Limited has been revoked by the regulatory arm of the Nigerian Exchange (NGX) Group Plc.
Known as NGX Regulations Limited (NGX Regco), the regulator said it took back the operating licence of the organisation after it shut down its operations.
The revocation of the licence was approved by Regulation and New Business Committee (RNBC) at its meeting held on September 24, 2025, a notice from the signed by the Head of Market Regulations at the agency, Chinedu Akamaka, said.
“This is to formally notify all trading license holders that the board of NGX Regulation Limited (NGX RegCo) has approved the decision of the Regulation and New Business Committee (RNBC)” in respect of Monument Securities and Finance Limited, a part of the disclosure stated.
Monument Securities and Finance Limited was earlier licensed to assist clients with the trading of stocks in the Nigerian capital market.
However, with the latest development, the firm is no longer authorised to perform this function.
Economy
NEITI Advocates Fiscal Discipline, Transparency as FG, States, LGs Get N6trn in Three Months
By Adedapo Adesanya
The Nigeria Extractive Industries Transparency Initiative (NEITI) has called for fiscal discipline and transparency as data showed that federal government, states, and local governments shared a whopping N6 trillion Federation Account Allocation Committee (FAAC) disbursements in the third quarter of last year.
In its analysis of the FAAC Q3 2025 allocation, the body revealed that the federal government received N2.19 trillion, states received N1.97 trillion, and local governments received N1.45 trillion.
According to a statement by the Director of Communication and Stakeholders Management at NEITI, Mrs Obiageli Onuorah, the allocation indicated a historic rise in federation account receipts and distributions, explaining that year-on-year quarterly FAAC allocations in 2025 grew by 55.6 per cent compared with Q3 of 2024 while it more than doubling allocations over two years.
The report contained in the agency’s Quarterly Review noted that the N6 trillion included 13 per cent payments to derivative states. It also showed that statutory revenues accounted for 62 per cent of shared receipts, while Value Added Tax (VAT) was 34 per cent, and Electronic Money Transfer Levy (EMTL) and augmentation from non-oil excess revenue each accounted for 2 per cent, respectively.
The distribution to the 36 states comprised revenues from statutory sources, VAT, EMTL, and ecological funds. States also received additional N100 billion as augmentation from the non-oil excess revenue account.
The Executive Secretary of NEITI, Mr Sarkin Adar, called on the Office of the Accountant General of the Federation, the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) FAAC, the National Economic Council (NEC), the National Assembly, and state governments to act on the recommendations to strengthen transparency, accountability, and long-term fiscal sustainability.
“Though the Quarter 3 2025 FAAC results are encouraging, NEITI reiterates that the data presents an opportunity to the government to institutionalise prudent fiscal practices that will protect the gains that have been recorded so far in growing revenue and reduce vulnerability to commodity shocks.
“The Q3 2025 FAAC results are encouraging, but windfalls must be managed with discipline. Greater transparency, realistic budgeting, and stronger stabilisation mechanisms will ensure these resources deliver durable benefits for all Nigerians,” Mr Adar said.
NEITI urged the government at all levels to ensure the growth of Nigeria’s sovereign wealth and stabilisation capacity, by committing to regular transfers to the Nigeria Sovereign Wealth Fund and other related stabilisation mechanisms in line with the fiscal responsibility frameworks.
It further advised governments at all levels to adopt realistic budget benchmarks by setting more conservative and achievable crude oil production and price assumptions in the budget to reduce implementation gaps, deficit, and debt metrics.
This, it said, is in addition to accelerating revenue diversification by prioritising reforms that would attract investments into the mining sector, expedite legislation to modernise the Mineral and Mining Act, support reforms in the downstream petroleum sector, as well as the full implementation of the Petroleum Industry Act (PIA) to expand domestic refining and value addition.
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