Economy
NSE Speaks on Scarcity of MTN Nigeria Shares
By Dipo Olowookere
Media reports alleging that some insiders’ dealings were going on in the trading of shares of MTN Nigeria Plc has forced the Nigerian Stock Exchange (NSE) to respond.
In a statement issued yesterday, the NSE said MTN Nigeria met its requirements before being admitted on its premium board by introduction.
“Where a company lists following an Initial Public Offering, shares are expected to be available for trading on the day of listing.
“In a Listing by introduction, however, no shares have been offered for subscription by the company prior to listing. Thus, without any intervention, it is possible that there will be no shares available for trading on the listing date.
“Indeed, currently, no rule of The Exchange compels shareholders in a listed company to tender their shares for trading. Shareholders are at liberty to trade their shares at any time and price suitable to them.
“Thus, in order to stimulate trading in the shares of companies that List by Introduction, the NSE’s practice is to urge the company to make shares available on the day of listing. In the case of MTN Nigeria, the NSE had requested the Company as part of the listing process to make shares available and The Exchange expects the company to do that.
“Since the listing of MTN Nigeria on Thursday, May 16, 2019, a total of 105,301,759 shares valued at N12,231,997,316 have traded in three (3) days. These trades were carried out by ten (10) Dealing Member Firms in 134 cross deals/negotiated deals.
“According to the Rulebook of The Exchange, when a Dealing Member or Authorized Clerk has an order to buy and an order to sell the same security at the same price, the Dealing Member or Authorized Clerk may “cross” those orders at a price at or within The Exchange’s best bid or offer.
“A variant of this is the negotiated deal, which describes a situation where a cross deal is executed between two Dealing Member Firms at a price which may be within The Exchange’s best bid or offer or with the approval of The Exchange, outside the best bid or offer.
“Because cross deals involve clients of the same Dealing Member Firm on both sides of a trade, significant issues have been raised that Dealing Members who have not been involved in the cross deals have been unable to trade on behalf of their clients. The Exchange is not unconcerned about this state of affairs. Indeed, Council members of The Exchange urged brokers to discuss with their clients about possible sales of shares.
“As an Exchange that champions transparency and equity for all stakeholders in our market, we have received stakeholder feedback concerning our present rules on cross dealing and will consider the issues raised as part of our sustained efforts to ensure our market remains equitable for all stakeholders. We believe in market forces as the most efficient methodology for price discovery. Demand and supply will interact to discover appropriate prices as trading activities continue in the market,” the NSE said in the statement.
Commenting on MTN Nigeria’s Free Float Valuation, the NSE said, “There appears to be a misconception that a concession was given to MTN Nigeria on the minimum free float required for companies listed on The Exchange.
“According to Rulebook of The Exchange, free float is defined as the number of shares that an Issuer has outstanding and available to be traded on The Exchange. It includes all shares held by the investing public, and excludes shares held directly or indirectly by promoters, directors and their close relatives; strategic investors holding five percent (5%) and above of the issued share capital; or government.
“The Exchange’s rules for listing on the Premium Board (which is the board in which MTN Nigeria is listed) require a Company to have a minimum free float of twenty percent of its issued share capital or that the value of its free float is equal to or above N40 billion on the date The Exchange receives the Issuer’s application to list. MTN Nigeria met with the free float requirement of N40 billion. The free float of MTN at the time of listing was in excess of N90 billion. Our rules are readily available on the website of The Exchange at www.nse.com.ng.
“Investor protection is very important to us at The Exchange and we have taken necessary steps to ensure that our market is fair and orderly. In 2016, we acquired NASDAQ’s SMARTS platform to proactively detect and deter manipulative tendencies, gather intelligence and execute risk-based supervision of flagged participants. We have also implemented other initiatives aimed at providing investors with timely information on the compliance status of our Dealing Members and Issuers including BrokerTrax, our member compliance report, and Compliance Status Indicator (CSI) codes (for Issuers). In addition, we have institutionalized our investor education program and launched X-Academy in June 2017, because we have identified investor education as a veritable tool to galvanizing informed investments and necessary step towards protecting investors in our market.
“Whilst we believe we have addressed the concerns raised, we will like to assure our stakeholders and the general public that The Exchange will continue to uphold global best practices in its business operations and will sustain engagement with its stakeholders to continually develop regulatory frameworks that ensure our market completely reflects our values of ambition, fairness and inclusion.”
By Aduragbemi Omiyale
The chief executive of the Nigerian Exchange (NGX) Limited, Mr Temi Popoola, has called for regional collaboration among African nations for a stronger capital market.
Speaking at the launch of the Ethiopian Securities Exchange (ESX) recently, he stated that working together would unlock the continent’s economic potential, especially with innovative market solutions.
He disclosed that strategic investment of the Nigerian bourse in ESX underscores its leadership in advancing Africa’s capital market infrastructure.
“The launch of ESX represents a pivotal moment for Ethiopia and the broader African financial landscape.
“ESX will serve as a crucial mechanism for capital formation and market liquidity, driving sustainable economic growth,” Mr Popoola said.
Expounding on NGX Group’s investment rationale, he highlighted Ethiopia’s immense market potential and the shared vision of fostering economic growth through innovation.
“Our partnership transcends traditional investment parameters.
“It is about ensuring that ESX evolves into a key player in Africa’s financial ecosystem, enabling cross-border investments and setting benchmarks for market development,” he said.
Mr Popoola also drew parallels with global success stories like India, which has leveraged its capital markets to achieve significant economic transformation.
He emphasized the importance of responsible market opening to attract local and continental capital, noting, “By following this path, Ethiopia can become a financial hub in Africa.”
Drawing from NGX Group’s six decades of experience, Mr Popoola shared insights on diversifying financial instruments and expanding access to investment opportunities.
“With the right mix of innovation, policy support, and regional collaboration, Ethiopia’s capital market can play a transformative role in driving economic development and establish itself as a leader in Africa’s financial ecosystem,” he concluded.
On his part, the Prime Minister of Ethiopia, Mr Abiy Ahmed, lauded the launch of ESX as a transformative milestone in the country’s journey toward economic modernization.
“Today, we have officially rung the bell to launch the Ethiopian Securities Exchange, our nation’s first stock exchange,” the Prime Minister announced on X.
“This is a call to global investors: Ethiopia offers immense potential, a fast-growing economy, and a clear trajectory toward shared prosperity,” he added.
The chief executive of ESX, Mr Tilahun Esmael Kassahun, expressed confidence in the partnership with NGX Group.
“We are pleased to welcome NGX Group as a strategic partner, building upon the existing support we continue to receive from them,” he said, emphasising the value of NGX Group’s expertise in shaping ESX’s growth and success.
With the ESX poised to redefine Ethiopia’s financial landscape, NGX Group’s involvement highlights the critical role of partnerships and shared expertise in advancing Africa’s economic narrative.
By Adedapo Adesanya
Daily average oil production in Nigeria rose by 152, 000 barrels per day in November 2024, according to the latest data by the Organization of the Petroleum Exporting Countries (OPEC).
According to the OPEC Monthly Oil Market Report (MOMR) for December 2024, the country’s production, including condensates rose by 11 per cent from 1.333 million barrels in October to 1.486 million in November 2024.
The analysis puts the daily increase to 152,000 barrels per day and about one million barrels increase between October and November last year.
This is as the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) in its latest oil production data indicated that on a month-on-month basis, daily average oil output in December 2024 declined by 1.35 per cent from 1.690 million barrels per day recorded in November 2024 to 1.667 million barrels per day.
Data from the commission also indicated that daily peak oil production in December 2024 was 1.79 million barrels per day while the lowest daily production was 1.57 million barrels per day
Cumulatively, oil output in December 2024, was 51.69 million barrels, a marginal increase of 1.9 per cent when compared to 50.71 million barrels produced in November 2024.
Further analysis of the data showed that the highest oil output in December 2024 was recorded at Forcados Terminal at 8.49 million barrels followed by Bonny Terminal, 7.78 million barrels and Qua Iboe, 4.15 million barrels.
The data showed without condensate, daily oil production was 1.484 million, indicating that Nigeria, again, failed to meet its oil production quota of 1.5 million barrels per day allotted to it by OPEC.
A recent survey by Reuters, however, shows that Nigeria crossed the 1.5 million barrels per day target in December.
The December 2024 average daily oil output also means that Nigeria failed to meet the 1.7 million barrels per day benchmark set for the 2024 budget all through the year.
NUPRC data on daily average production showed that oil production including condensate in January 2024 was 1.64 million barrels per day; February, 1.53 million barrels per day; March, 1.44 million barrels per day; April, 1.45 million barrels per day; May, 1.47 million barrels per day; June, 1.50 million barrels per day; July, 1.53 million barrels per day; August, 1.57 million barrels per day; September, 1.54 million barrels per day, October, 1.54 million barrels per day November, 1.69 million barrels per day and December, 1.67 million barrels per day.
By Dipo Olowookere
The trio of Wema Bank, FBN Holdings, and Universal Insurance topped the activity chart of the Nigerian Exchange (NGX) Limited last week with a turnover of 1.679 billion shares worth N20.838 billion transacted in 4,922 deals, contributing 35.74 per cent and 24.50 per cent to the total trading volume and value, respectively.
Data from Customs Street showed that in the five-day trading week, investors bought and sold 4.698 billion stocks valued at N85.043 billion in 72,562 deals versus the 2.618 billion stocks sold for N69.742 billion in 47,953 deals in the preceding week.
The financial services industry attracted the attention of the market participants with 3.470 billion equities worth N40.791 billion traded in 34,364 deals, contributing 73.86 per cent and 47.97 per cent to the total trading volume and value, respectively.
The services sector followed with 407.032 million shares worth N2.226 billion in 4,996 deals, and the ICT space transacted 237.680 million stocks valued at N3.628 billion in 5,280 deals.
Business Post reports that 51 shares appreciated in the week versus 82 shares in the previous week, 39 equities depreciated compared with 18 equities a week earlier, and 62 stocks closed flat versus 52 stocks in the preceding week.
Multiverse was the best-performing stock with a a price appreciation of 53.42 per cent to N12.35, Honeywell Flour gained 31.67 per cent to close at N10.02, DAAR Communication expanded by 25.71 per cent to 88 Kobo, MTN Nigeria leapt by 21.00 per cent to N242.00, and NCR Nigeria soared by 20.66 per cent to N7.30.
On the flip side, Sunu Assurances was the worst-performing stock after it went down by 36.52 per cent to N7.30, Caverton shed 15.00 per cent to N2.38, Consolidated Hallmark slumped by 15.00 per cent to N3.40, RT Briscoe slipped by 14.33 per cent to N2.57, and Jaiz Bank depreciated by 10.77 per cent to N2.90.
At the close of business, the All-Share Index (ASI) and the market capitalisation gained 1.80 per cent to close the week at 105,451.06 points and N64.303 trillion, respectively.
Also, all other indices closed higher apart from the insurance, AFR Bank Value, AFR Div Yield, MERI Value, consumer goods, energy, and industrial goods, which depreciated by 6.91 per cent, 0.08 per cent, 1.11 per cent, 0.17 per cent, 0.34 per cent, 0.34 per cent and 0.26 per cent, respectively, as the ASeM closed flat.
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