Nigerian Equity Market Witnesses Low Weekly Turnover
By Dipo Olowookere
The Nigerian equity market witnessed a low turnover last week, with just 840.3 million shares worth N9.6 billion traded in 13,239 deals as against the 1.4 billion shares worth N15.9 billion transacted a week earlier in 18,459 deals.
Business Post reports that the major reason for this low trading volume in the week was due to the two-day holiday observed in the country on Wednesday and Thursday to mark the end of the holy month of Ramadan and commemorate the Eid al-Fitr celebrations. This meant that the market only operated for three days.
But this did not tamper with the key performance indicators of the bourse as the All-Share Index and market capitalisation appreciated by 0.72 per cent to close at 39,481.89 points and N20.579 trillion respectively.
Similarly, all other indices finished higher with the exception of the sovereign bond index, which depreciated by 10.69 per cent, while the ASeM and growth indices closed flat.
In the week, investors sustained their appetite for financial stocks, accounting for 541.0 million units worth N5.5 billion traded in 7,824 deals.
This signified that shares in this category contributed 64.38 per cent and 57.45 per cent to the total trading volume and value respectively.
Equities in the ICT sector recorded 90.4 million units valued at N571.6 million in 500 deals, while shares in the conglomerates industry posed a turnover of 84.8 million units worth N512.8 million in 551 deals.
In terms of individual stocks, Access Bank, Zenith Bank and eTranzact were the most active with 284.9 million units valued at N3.5 billion transacted in 2,533 deals, contributing 33.91 per cent and 36.29 per cent to the total trading volume and value respectively.
A total of 33 equities appreciated in price during the week, higher than 31 in the previous week, while 19 equities depreciated in price lower than 37 equities in the previous week, with 108 equities closing flat, higher than 92 equities of the preceding week.
Consolidated Hallmark Insurance was the best-performing stock with a price appreciation of 25.64 per cent to close at 49 kobo.
ABC Transport gained 19.35 per cent to sell for 37 kobo, Africa Prudential rose by 17.12 per cent to trade at N6.50, Royal Exchange grew by 16.92 per cent to sell for 76 kobo, while NEM Insurance gained 14.92 per cent to close at N2.08.
On the flip side, the worst-performing stock was Academy Press as its share value went down by 10.00 per cent to 36 kobo, followed by Chams, which dropped 9.09 per cent to quote at 20 kobo.
Japaul lost 8.33 per cent to trade at 55 kobo, Sterling Bank depreciated by 6.92 per cent to close at N1.48, while Okomu Oil declined by 6.31 per cent to trade at N96.50.
Subsidy Removal: CNG at N130 Per Litre Cheaper Than Petrol—IPMAN
By Adedapo Adesanya
The Independent Petroleum Manufacturers Association of Nigeria (IPMAN) has advised Nigerians to begin to look into the direction of Compressed Natural Gas (CNG) as an alternative energy source to cushion the effect of subsidy removal.
The National President of IPMAN, Mr Chinedu Okorokwo, made this known in an interview with the News Agency of Nigeria (NAN) in Abuja on Wednesday, as the federal government continues its dialogue with the organised labour over the hike in the price of premium motor spirit (PMS), otherwise known as petrol.
On May 29, 2023, during his inaugural speech, President Bola Tinubu said the payment of subsidy for fuel had ended because there was no provision for it in the 2023 budget beyond June 30.
His announcement triggered the hoarding of fuel by marketers, and when the Nigerian National Petroleum Company (NNPC) Limited increased the price of the product across its retail outlets, prices of food, transportation and services went up, forcing the Nigeria Labour Congress (NLC) and the Trade Union Congress (TUC) to threaten a nationwide strike, which was supposed to start today but was stopped by the National Industrial Court.
At a meeting on Monday night between the government and the labour unions, it was agreed that the adoption of CNG as an alternative fuel would be the best option, and it was agreed that the CNG conversion programme earlier planned in 2021 should be revived.
CNG, which is a gas mainly composed of methane and produces less emission, is the cleanest burning fuel operating today with less vehicle maintenance and longer engine life.
In the interview with NAN, Mr Okoronkwo said bringing CNG, which was cheaper than even firewood, as an alternative energy, would create relief for the government and its citizens.
“We have also discovered that bringing an alternative that is cheaper than even firewood which is CNG, will not only create relief for the government and its citizens but it is environmentally friendly.
“The CNG is abundantly available in Nigeria than anywhere in Africa.
“In the Niger Delta region, you see billions of tonnes of gas flare being wasted daily, these are huge amounts that should be accruing to our GDP, but we are wasting it because there is no market for it.
“So, we are asking the government to create the market. How do you create the market?
“What Egypt and India did was to give soft loans to be paid back within stipulated periods; from there, you can get vehicles to use gas instead of fuel,” he said.
“There’s a franchise for the bottling of CNG so that an average woman in the kitchen can use it,’’ he added, noting that the introduction of CNG would cushion the effect occasioned by the high price of fuel currently as a litre of CNG would not cost more than N130.
He advised that repairing the local refineries as well would reduce the impact of the removal as it would eliminate the cost of importation and exportation.
Nigeria Upgrades Tax-to-GDP Ratio to 10.86% From 6%
By Modupe Gbadeyanka
The National Bureau of Statistics (NBS) has disclosed that Nigeria’s tax to Gross Domestic Product (GDP) ratio has been upwardly reviewed to 10.86 per cent from the 6 per cent earlier reported to reflect better data sources and improved estimation using the Organisation for Economic Co-operation and Development (OECD) manual.
The OECD manual is an improvement over the System of National Accounts (SNA 2008) classification of taxes.
Although the System of National Accounts conceptual framework and its definitions of the various sectors of the economy are reflected in the OECD’s classification of taxes, the OECD classifications provide the maximum disaggregation of statistical data on what is generally regarded as taxes by tax administrations.
In a disclosure, the statistics office said the country’s total tax revenue compared with its GDP was at that level in 2021, higher than 8.40 per cent in 2020, which was impacted by the COVID-19 pandemic.
In the previous year, the ratio was 10.20 per cent, marginally lower than the 10.36 per cent recorded in 2018 but higher than the 9.02 per cent in 2017.
The NBS said the revised computation considered more comprehensive coverage of data at the federal, state, and local government levels and revenue items not previously included in the computations, particularly relevant revenue collected by other government agencies.
The review of the tax-to-GDP ratio was initiated by the Federal Inland Revenue Service, which collaborated with the Federal Ministry of Finance and the NBS for better measurement of the ratio.
The data used were sourced from the Office of the Accountant General of the Federation (OAGF), FIRS, NBS, the Nigeria Customs Service (NCS), the Joint Tax Board (JTB), and other relevant agencies of government that collect revenue.
VFD Group to Join Nigerian Exchange After Exit From NASD
By Adedapo Adesanya
VFD Group Plc has announced its intention to list its shares on the Nigerian Exchange Group (NGX) after leaving the NASD Over-the-Counter Securities Exchange, where it has been trading its stocks for the past three years.
This development, according to analysts, is a strategic move that would allow the company to gain access to public equity markets, increase its visibility, and strengthen its financial position.
VFD Group Plc is a leading proprietary investment company with a proven track record of generating attractive returns for its investors through a variety of investment strategies.
The company has a diverse portfolio of investments in various sectors, including banking, technology, media, energy, and real estate. The group has been listed on the NASD OTC Securities Exchange since 2020.
Speaking on this big step, Mr Nonso Okpala, Group Managing Director of VFD Group, stated, “We are excited to take this next step in the evolution of our company.”
“Listing on a major stock exchange will give us access to a larger pool of investors, enhance our profile, and provide superior returns to our investors,” he added.
With the intention of listing on the NGX, the company will delist from the NASD and is subject to regulatory approvals and market conditions.
VFD Group noted that it would provide additional updates as the listing process progresses.
At the close of business on Tuesday, the securities of the organisation closed on the NASD OTC exchange at N244.88 per unit, the same rate they finished in the preceding trading session.
Business Post reports that the NASD was created to provide an avenue for public companies to transition smoothly into the country’s main stock exchange.
However, it has witnessed the movement of firms from the NGX to the NASD, especially due to the very strict regulatory requirements by the former.
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