Connect with us

Economy

Profit Takers Drag ASI to 37,847.07 Points, Market Cap to N19.725trn

Published

on

profit-takers

By Dipo Olowookere

The All-Share Index (ASI) of the Nigerian Exchange (NGX) Limited depreciated by 1.81 per cent or 698.23 points on Tuesday to finish at 37,847.07 points as against 38,545.30 points it ended a day earlier.

This was majorly caused by the actions of profit takers, who pounced on the market to offload some stocks that have gained in the past few trading sessions.

This also affected the market capitalisation of the stock exchange, which reduced by N364 billion to finish at N19.725 trillion compared with N20.089 trillion it ended on Monday.

Business Post reports that the market breadth closed negative yesterday with 17 price gainers and 23 price losers led by Airtel Africa, which lost 10.00 per cent to close at N678.00.

ALSO READ  Ingenico, Interswitch Partner for Payment Solutions in Nigeria

Mutual Benefits Assurance went down by 7.32 per cent to trade at 38 kobo, Cornerstone Insurance declined by 7.27 per cent to 51 kobo, Learn Africa depreciated by 648 per cent to N1.01, while Ikeja Hotel fell by 6.19 per cent to 91 kobo.

On the other side, Fidson shook off the bad performance of Monday to close as the best-performing stock by rising by 10.00 per cent to N5.06.

Vitafoam gained 9.68 per cent to trade at N13.60, Red Star Express appreciated by 9.55 per cent to N3.67, Veritas Kapital improved by 9.09 per cent to 24 kobo, while Courtville gained 5.00 per cent to quote at 21 kobo.

ALSO READ  Ways To Solve Nigeria’s Economic Crisis—CIBN

The most traded stock of the day was Transcorp as it sold 42.4 million shares valued at N37.2 million. Vitafoam traded 20.1 million equities worth N271.6 million, Dangote Sugar exchanged 17.6 million stocks for N312.1 million, FBN Holdings sold 12.4 million equities valued at N88.5 million, while Access Bank traded 11.5 million shares for N98.4 million.

At the close of business, investors traded a total of 218.3 million stocks worth N2.7 billion in 3,524 deals compared with the 209.2 million equities worth N1.8 billion transacted in 3,390 deals on Monday, indicating increases in the trading volume by 4.33 per cent, trading value by 54.59 per cent and the number of deals by 3.95 per cent.

ALSO READ  Profit Takers Push Stock Market Down by N124

In terms of the performance of the sectors yesterday, the energy and consumer goods sectors appreciated by 0.05 per cent and 002 per cent respectively, while the industrial goods, insurance and banking counters depreciated by 1.13 per cent, 0.39 per cent and 0.07 per cent apiece.

Dipo Olowookere is a journalist based in Nigeria that has passion for reporting business news stories. At his leisure time, he watches football and supports 3SC of Ibadan. Mr Olowookere can be reached via dipo.olowookere@businesspost.ng

Click to comment

Leave a Reply

Economy

Africa Prudential Suffers Decline in H1 2021 Revenue, Profits

Published

on

Africa Prudential office

By Dipo Olowookere

The first half of 2021 was not good for Africa Prudential, the company’s financial statements released on Friday and analysed by Business Post has shown.

The top and bottom lines of the results depreciated in the first six months of the year, with the revenue generated going down to N1.7 billion from N1.9 billion in the same period of 2020.

The results revealed that revenue from contracts with customers went down by 12 per cent to N517.7 million from N590.7 million due to a significant renegotiation of fees rate by customers along with its corporate actions revenue lines as well as slow sign off of contracts within the period in digital consultancy.

ALSO READ  Ways To Solve Nigeria’s Economic Crisis—CIBN

Also, the interest income decreased to N1.2 billion from N1.3 billion as a result of a decline in interest on loans and advances and a nil income on treasury bills relative to HY 2020.

However, the other income improved to N86.3 million from N23.8 million and this was largely buoyed by withholding tax credit notes recovered, which raked in N65.8 million for the company. In H1 2020, there was no provision for this item. Also, the dividend income recorded in the first half of this year waned to N9.3 million from N21.2 million last year.

ALSO READ  Profit Takers Push Stock Market Down by N124

In the period under review, Africa Prudential said personnel expenses gulped N287.6 million, lower than N318.2 million of last year and this was due to a slice in wages and salaries to N264.1 million from N291.0 million in the period.

However, the other operating costs rose to N450.4 million from N323.0 million as a result of an increase in professional fees, directors fees and other emoluments, legal and professional expenses, amongst others.

ALSO READ  Kaduna Electric Sacks 24 Staff Over Fraud

On the bottom line, the company posted a profit before tax of N972.3 million, lower than the N1.2 billion achieved in the first half of last year, while the profit after tax went down to N827.6 million from N1.1 billion on account of the business considerations around revenue and operating cost, with the Earnings Per Share (EPS) declining to 41 kobo from 54 kobo in H1 2020.

Continue Reading

Economy

Market Rises 0.21% as Appetite for Total Nigeria Shares Persists

Published

on

Total Nigeria shares

By Dipo Olowookere

The interim dividend proposed by the board of Total Nigeria and the news of the settlement of the dispute between Oando Plc and the Securities and Exchange Commission (SEC) is starting to drive appetite for the two energy stocks at the Nigerian Exchange (NGX) Limited.

Business Post reports that appetite for Total Nigeria shares persisted on Friday and this helped the market to close 0.21 per cent higher when trading activities were ended during the session.

This buying pressure increased the All-Share Index (ASI) of the bourse by 82.38 points to 38,667.90 points from 38,585.52 points and expanded the market capitalisation by N43 billion to N20.147 trillion from N20.104 trillion.

ALSO READ  CBN Sustains Pressure on System Liquidity with N25b OMO Sale

Universal Insurance was the best-performing stock at the last trading session of this week, appreciating by 10.00 per cent to close at 22 kobo.

Oando gained 9.97 per cent to trade at N3.97, Total Nigeria grew by 9.96 per cent to N203.20, Cutix improved by 9.82 per cent to N4.81, while Guinness Nigeria appreciated by 9.14 per cent to N31.65.

However, University Press finished the session as the worst-performing equity with a price depreciation of 9.03 per cent to settle at N1.41.

Champion Breweries lost 8.89 per cent to sell for N2.05, Red Star Express declined by 3.03 per cent to N3.20, International Breweries went down by 2.80 per cent to N5.20, while NAHCO fell by 2.65 per cent to N2.20.

ALSO READ  Banks Erase $1.2b 9Mobile Debt From Books

At the close of transactions, the market breadth remained strongly positive with 30 price gainers and 11 price losers.

On the activity chart, the trading volume rose by 13.36 per cent to 230.3 million shares from 203.1 million shares, the trading value appreciated by 34.04 per cent to N2.3 billion from N1.7 billion, while the number of deals increased by 4.18 per cent to 4,135 deals from 3,969 deals.

Fidelity Bank closed the day as the most traded stock for transacting 24.8 million shares valued at N59.4 million and was followed by Zenith Bank, which exchanged 24.3 million equities worth N604.1 million.

ALSO READ  FG Denies Seizure of Ekiti Allocation

United Capital transacted 14.5 million shares worth N102.6 million, UBA traded 11.0 million shares valued at N85.3 million, while Sovereign Trust Insurance transacted 10.4 million stocks for N2.9 million.

In terms of the performance of the sectors, apart from the insurance counter, which depreciated marginally by 0.01 per cent, the four other major sectors closed positive.

The energy index maintained its strong position with an appreciation of 3.98 per cent, the banking counter rose by 0.51 per cent, the consumer goods space rose by 0.40 per cent, while the industrial goods sector appreciated by 0.04 per cent.

Continue Reading

Economy

Nigeria Records 28 Deals Worth $1bn in H1 2021

Published

on

28 Deals Worth $1bn

By Modupe Gbadeyanka

A new report from Baker McKenzie has indicated that in the first half of 2021, Nigeria and South Africa recorded a surge in mergers and acquisitions (M&A).

However, Kenya, another key economy in Sub-Saharan Africa, witnessed a slight decline in the period under consideration, according to an analysis of Refinitiv data.

It was revealed that 28 deals worth $1 billion were recorded in Nigeria in H1 2021, indicating that by transaction volume, it rose by 17 per cent and by value, it soared by 267 per cent.

Refinitiv data reveals that domestic transactions decreased by 15 per cent to 11 deals, but deal value increased by 342 per cent year-on-year to $726 million.

Also, cross-border transactions increased by 13 per cent to 17 deals, with deal value rising by 8 per cent to $296 million, with financial companies being the prime targets for inbound deals at four transactions, showing a 100 per cent increase y-o-y and deal value of $10 million, a 327 per cent increase year on year.

Once again, the US served as the primary investor for Nigerian companies, with four deals worth $13 million. The largest inbound deal into Nigeria in H1 2021 was Mwendo Holdings BV’s (South Africa) $182 million acquisition of Blue Lake Ventures Ltd (Media and Entertainment), announced in June 2021.

In a statement obtained by Business Post, the Head of Africa for Baker McKenzie, Mr Wildu du Plessis, stated that while investors from the US have shown interest in Africa for some time, under President Joe Biden, the general consensus is that US engagement with African countries is focusing on strengthening relationships in a strategic, co-operative way.

ALSO READ  Ingenico, Interswitch Partner for Payment Solutions in Nigeria

It has been noted that Mr Biden will continue with successful bipartisan programmes implemented by his predecessors, as well as further encouraging US trade and investment in the continent.

Considering that American companies were the top investors in two of Africa’s largest economies in the first half of 2021, dealmakers are clearly comfortable with Biden’s approach to Africa.

South Africa

The value of M&A transactions in South Africa in H1 2021 amounted to $52 billion, with 169 deals announced in the period. Compared to the first half of 2020, transactions volumes decreased by 8 per cent but deal value increased by 958 per cent in the first half of 2021.

Refinitiv data showed that the volume of domestic transactions increased slightly to 80 deals, a 10 per cent increase y-o-y. Domestic transactions in South Africa in H1 21 were worth $46.7 billion, a dramatic 2,148 per cent increase. Further, cross-border transactions increased 17 per cent to 89 deals, with deal value surging 251 per cent to $5.4 billion.

According to Marc Yudaken, Partner in the Corporate/M&A Practice at Baker McKenzie in Johannesburg, “Despite the excellent start to 2021, the unrest in South Africa threatens to impact the positive strides made in terms of foreign investment into the country in the first six months of this year.

“For the sake of South Africa’s post-pandemic recovery, the turmoil engulfing our country has to be ended before investors are forced to seek less risky alternatives.

ALSO READ  Profit Takers Weaken Nigerian Stocks by 0.86% Day After Unusual Trading

“Foreign investors will only ramp up their investments if they are confident their assets are safe. They need political and economic certainty and must have confidence that there is rule of law in the countries in which they invest.”

High technology companies were the primary targets for inbound deals in South Africa, with 12 transactions, representing 200 per cent in deal volume and a deal value of $160 million, an increase of 1,997 per cent when compared to the same period last year.

“It’s no secret that African consumers have shown a growing reliance on technology across multiple platforms, even well before the pandemic struck.

“The growth of the digital economy across the continent has naturally been accelerated by the pandemic and this unabated demand for technology has caused extensive cross-sector disruption, with the financial, energy, transport, retail, health and agricultural sectors all seeking opportunities to expand their tech infrastructure in order to acquire the necessary skills and innovation needed to keep up with demand.

“Fintech is also a popular tech sector for investment across Africa and specifically in South Africa, Kenya and Nigeria, with health-tech, mobility and agritech also attracting growing interest,” Mr du Plessis noted.

“It looks like South Africa is leading the way in terms of high-value deals in the tech sector and we expect this tech M&A trend to continue as the continent gears up to operate in the post-pandemic new normal,” he added.

The United States was the primary investor for South African companies, with 16 deals (an increase of 60 per cent) valued at $496 million (an increase of 340 per cent).

ALSO READ  CACOL Defends Corruption Petition Against Suspended SEC DG

This was helped by TPG Capital LP’s $200 million acquisition of Airtel Africa Plc-Mobile (telecommunications) announced in March 2021. The largest inbound deal in H1 2021 was Temasek Holdings (Pte) Ltd’s (Singapore) $500 million acquisition of Leapfrog Investments (financials), also announced in March 2021.

Kenya

In H1 2021, deal-making in Kenya decreased by 14 per cent with 18 deals in the period and deal value decreased by 96 per cent to $11 million.

Financial companies were the prime targets for inbound deals with five transactions, representing a 150 per cent increase, with deals valued at $11 million, a 78 per cent decrease.

Nigeria served as the primary investor for Kenyan companies with three deals. The largest inbound deal into Kenya in H1 2021 was Liberty Holdings Ltd’s (South Africa) $8 million acquisition of Liberty Kenya Holdings Plc (insurance), announced in March 2021.

In its reaction to this, Mr Du Plessis said the decrease in M&A volume and value in Kenya in H1 2021 is expected to be temporary as the country continues to implement pandemic recovery policies, including a vaccine rollout strategy for the adult population with a planned completion date of mid-2022.

“The country’s reputation as an East African investment hub, in addition to its strong technology capabilities, means that it is just a matter of time before Kenya takes up its rightful place as one of the top target countries for technology transactions in Africa,” he submitted.

Continue Reading

Like Our Facebook Page

Latest News on Business Post

Trending

%d bloggers like this: