Connect with us

Economy

NGX RegCo Explains Procedures for Listing Price of Stocks

Published

on

NGX RegCo

By Aduragbemi Omiyale

Worried by the misconception regarding how the listing price of stocks of companies on the Nigerian Exchange (NGX) Limited, the NGX Regulation (NGX RegCo) Limited has explained the role it plays in the process.

It was speculated that the prices public firms listed their shares on the exchange were ridiculous and that NGX RegCo was not getting involved actively in the process, especially helping to set a reasonable value to protect the interest of investors.

But in a statement, the agency said, “An Issuer seeking to list its equity securities on NGX (where the equity securities of the Issuer have not already been listed on NGX) is required to indicate the proposed listing price of the equity securities in its application to list.

“The Issuer is also required to submit a pricing memorandum, which is a document that details methodologies and assumptions adopted by the Issuer and its advisers in arriving at the proposed listing price, among other documents.”

According to NGX RegCo, while reviewing the listing application, it “does not intervene in the proposed listing price, as obtains in some other jurisdictions.”

“However, NGX RegCo reviews the pricing memorandum to understand the basis of arriving at the listing price and to evaluate whether the pricing methodologies and assumptions are based on generally accepted valuation principles.

“It is the responsibility of the Issuer and its advisers to determine the listing price using a generally accepted pricing methodology. The listing requirements of NGX do not require NGX RegCo to determine a fair price of equity securities or to fix the listing price for an Issuer,” the statement stressed.

“As it is well known, one of the functions of an efficient securities market is to determine fair prices of securities through the operation of market forces. Following the listing, where the listing price of an Issuer is perceived to be too high or too low, the market price is expected to be appropriately corrected by the market forces of demand and supply to arrive at a fair price as trading commences.

“As such, the power is in the hands of investors and their advisers, when transacting in the market, to assess share prices (or other securities) of Issuers of interest, and to determine whether the securities are overvalued, undervalued or fairly valued in order to take appropriate positions on the securities. In other words, it is not unusual for investors to view the listing price of an Issuer either with respect or with scepticism, identifying mispricing when it exists and acting accordingly. This corrective action is a hallmark of any free and fair market,” it added.

Concluding, the NGX RegCo stressed that it remains “committed to promoting the integrity, transparency and efficiency of our market, ensuring that the standards set are effective in maintaining a fair and orderly market where investors are adequately protected.”

Aduragbemi Omiyale is a journalist with Business Post Nigeria, who has passion for news writing. In her leisure time, she loves to read.

Continue Reading
Click to comment

Leave a Reply

Economy

Female-led Businesses Have 7.2% Higher Activity Rate Than Male Counterparts—Eniolorunda

Published

on

Nigeria's Business Environment

By Modupe Gbadeyanka

The chief executive of Moniepoint Incorporated, Mr Tosin Eniolorunda, has said it’s more profitable to serve women than their male counterparts.

Speaking at the second International Financial Inclusion Conference 2024 organized by the Central Bank of Nigeria (CBN) and other critical stakeholders, he said women entrepreneurs have proven to be diligent and enhance profitability.

He disclosed that based on data harvested from the Moniepoint platform, “women-owned businesses are more likely to stay active and show higher engagement rates in financial transactions.”

According to him, in cases where financial support has been extended—through investments, KYC compliance, or the provision of tools like point-of-sale devices—female-led businesses have a 7.2 per cent higher activity rate than their male counterparts while looking at the gender relations with credit products, “women-owned businesses have an 87.5 per cent lower loan non-performance rate (NPL) than male-owned enterprises.”

He submitted at the event themed Inclusive Growth: Harnessing Financial Inclusion for Economic Development that for financial inclusion to be sustainable, especially for women, it must no longer be treated as a buzzword, charitable social activity or a checklist to be marked.

Mr Eniolorunda noted that financial service providers play a vital role in supporting gender-inclusive finance and that by collecting and analysing data on gender trends in small business performance, they can craft better policies, targeted products, and support services that encourage more women entrepreneurs.

Echoing similar sentiments, his counterpart at the Credit Registry, Ms Jameelah Sharrieff-Ayedun, said, “90 per cent of women’s income that they receive goes back to the communities and their families as such when women have access to credit, the community is enhanced, families are better off which is why it’s important that they can access this funding.”

In her summation, the Deputy Governor of the CBN for Operations, Ms Emem Usoro acknowledged some of the structural challenges that might require time and resources to be addressed including cultural practices and less systemic ones such as distance to financial services providers that stifle the participation of women-owned businesses, while signposting the power of data to catalyze inclusive growth and its viability for economic planning.

Continue Reading

Economy

Stanbic IBTC Asset Management Moves to Protect Mutual Fund Holders

Published

on

mutual-funds-gain

By Aduragbemi Omiyale

A significant step has been taken by Stanbic IBTC Asset Management to protect mutual fund holders from scams.

This is being implemented through a campaign launched by the organisation to raise awareness of scam attempts that may mislead customers into using incorrect account details, highlighting the tactics used by scammers to keep customers informed and vigilant.

Stanbic IBTC Asset Management intends to use this means to build trust and reassurance, reinforcing its dedication to the financial safety of its clients.

This move, taken in response to an alarming rise in scam attempts targeting mutual fund holders, will educate customers on protecting their investments and understanding the correct procedures for mutual fund subscriptions.

The firm has advised customers to verify the payment accounts for any Stanbic IBTC mutual fund investments, encouraging due diligence in confirming the legitimacy of financial communications.

The chief executive of Stanbic IBTC Asset Management, Ms Busola Jejelowo, said, “At Stanbic IBTC, our top priority is our customers’ financial safety, and we are fully committed to ensuring that our clients have the security they need while managing their investments.

“This campaign is designed to protect our customers and empower them with the knowledge necessary to recognise and verify the authenticity of any communications they receive.

“By doing so, we aim to foster a sense of confidence and security among our clients regarding their financial decisions.”

It was gathered that recently, enquiries about the authenticity of mutual fund subscription messages have surged. Many of these messages contain differing and potentially incorrect account numbers, leading to confusion and concern among investors.

The company has made it clear that customers should not hesitate to contact the support team directly with any concerns, questions, or suspicions regarding communications or transactions.

Continue Reading

Economy

NASD Index Records 0.67% Appreciation

Published

on

NASD Unlisted Security Index

By Adedapo Adesanya

The NASD Over-the-Counter (OTC) recorded a 0.67 per cent appreciation on Thursday, November 28, with the portfolios of investors on the platform rising by N7.09 billion to N1.061 trillion from the N1.053 trillion it closed in the preceding session and the NASD Unlisted Security Index (NSI) growing by 20.22 points to wrap the session at 3,026.60 points compared with 3,006.38 points recorded on Wednesday.

This happened after the unlisted securities market finished the trading session with three price gainers and two price losers.

Afriland Properties Plc gained N1.58 to end at N17.39 per unit compared with the midweek’s closing price of N15.81 per unit, as Acorn Petroleum Plc improved its value by 14 Kobo to close at N1.69 per share, in contrast to the previous day’s N1.55 per share, and Central Securities Clearing System (CSCS) Plc went up by N1 to sell for N23.00 per unit compared with the preceding session’s N22.00 per unit.

On the flip side, First Trust Microfinance Bank Plc lost 4 Kobo to finish at 32 Kobo per share versus Wednesday’s closing price of 36 Kobo per share and Geo-Fluids Plc slumped by 3 Kobo to sell at N3.90 per unit compared to N3.93 per unit it was sold a day earlier.

There was a 191.9 per cent rise in the volume of securities traded in the session as investors exchanged 2.9 million units compared with the previous trading day’s 1.0 million units.

Equally, there was a 283.9 per cent surge in the value of shares traded yesterday to N7.9 million from the N2.1 million recorded in the previous day, and the number of deals increased by 300 per cent to 12 deals from the three deals executed in the preceding day.

At the close of transactions, Geo-Fluids Plc was the most active stock by volume (year-to-date) with 1.7 billion units valued at N3.9 billion, trailed by Okitipupa Plc with 752.2 million units sold for N7.8 billion, and Afriland Properties Plc with 297.3 million units worth N5.3 million.

Aradel Holdings Plc remained the most active stock by value (year-to-date) with 108.7 million units worth N89.2 billion, followed by Okitipupa Plc with 752.2 million units valued at N7.8 billion, and Afriland Properties Plc with 297.3 million units sold for N5.3 billion.

Continue Reading

Trending