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Nigerian Exchange Limited

VFD Group Plc’s Rights Issue Listed on NGX’s Daily Official List

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The Nigerian Exchange Limited (NGX) has listed VFD Group Plc’s Rights Issue on its Daily Official List.

The move follows the approval by the Securities and Exchange Commission (SEC) and represents a crucial step in the company’s growth trajectory.

The Rights Issue comprises 63,342,455 ordinary shares of 50 kobo each priced at N197.33 per share, bringing the total value of the issue to N12.499 billion. With this listing, VFD Group Plc’s total issued and fully paid-up shares have surged from 190,027,365 to 253,369,820 ordinary shares.

According to a report by NGX, the additional shares listed arose from VFD’s Rights Issue on the basis of one ordinary share for every three ordinary shares held as of October 12, 2023.

This move underscores VFD Group Plc’s commitment to expanding its shareholder base and enhancing liquidity in the market.

The approval by SEC for the Rights Issue further solidifies VFD Group Plc’s position in the market. Gbeminiyi Shoda, the Group Company Secretary of VFD Group Plc, confirmed that the Qualification Date for the Rights Issue was October 12, 2023, with the application list opening on December 20, 2023, for a maximum period of 31 days.

VFD Group Plc’s Rights Issue comes on the heels of its recent listing on the Main Board of the Nigerian Exchange Limited (NGX). The listing of 190 million units of shares at N244.88 per share added N46.527 billion to NGX’s market capitalization, reflecting the company’s growing influence in the Nigerian capital market.

VFD Group Plc, known for its sector-agnostic proprietary investment approach, aims to create positive and socially conscious ecosystems by aggregating potentially viable businesses. The Rights Issue listing underscores the company’s strategic move to increase visibility, access capital, and enhance liquidity, ultimately benefiting its investors and stakeholders.

Investors and market analysts are closely watching the developments surrounding VFD Group Plc as it continues to expand its footprint in the Nigerian financial landscape. With the successful listing of its Rights Issue on NGX, the company is poised for further growth and value creation in the market.

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Nigerian Exchange Limited

NGX Index and Market Cap Up by 0.44%, Gains Hit N246bn

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The Nigerian equity market continued its upward trajectory for the third consecutive day as the Nigerian Exchange (NGX) All-Share Index (ASI) and market capitalisation closed in the green.

The Nigerian Exchange (NGX) All-Share Index (ASI) and market capitalisation increased by 0.44% on Wednesday. This upward movement translated into a significant gain of approximately N246 billion.

The NGX ASI closed at 98,818.04 points, up from the previous day’s 98,383.04 points.

Similarly, the market capitalisation rose to N55.90 trillion from N55.65 trillion, indicating a robust performance across various sectors.

Key contributors to the market rally included Abbey Mortgage Bank, which appreciated by 9.76% to close at N2.70 per share.

The National Salt Company of Nigeria (NASCON) followed closely with a 9.66% rise to N40.85 per share. First City Monument Bank (FCMB) also saw a significant gain of 9.63%, closing at N7.40 per share.

The positive sentiment was not limited to a few stocks; 28 other gainers also contributed to the market’s overall performance.

This widespread optimism among investors helped improve the year-to-date return from 31.6% to 32.2%, reflecting a more bullish outlook for the market.

The Consumer and Industrial Goods sectors were among the top performers. The Consumer Goods Index rose by 0.9%, driven by gains in Dangote Sugar and NASCON Allied Industries Plc.

The Industrial Goods Index saw a modest increase of 0.1%, supported by positive movements in West Africa Gas Pipeline Company.

Despite the overall positive trend, some stocks experienced losses. International Energy Insurance led the laggards, dropping by 9.68% to close at N1.40 per share.

Jaiz Bank shed 6.52% to close at N2.15, and Tantaliser fell by 6.00% to N0.47 per share.

The market saw a slight dip in trading volume and value, which decreased by 7.3% and 27.6%, respectively.

A total of 518.9 million units valued at N4.8 billion were traded on Wednesday, indicating a cautious yet optimistic trading environment.

Market analysts attribute the sustained rally to renewed investor confidence and strategic buy demands in key stocks such as Dangote Sugar, First Bank of Nigeria Holdings, and Zenith Bank.

“The consistent upward movement in the market reflects positive investor sentiment and a stable economic outlook,” said market analyst Chinedu Okafor.

As the market continues to show signs of strength, investors remain hopeful that the positive momentum will sustain. With the year-to-date return improving, market watchers are optimistic about future gains, especially if current economic conditions and investor sentiments remain favorable.

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Nigerian Exchange Limited

Nigerian Equity Market Gains N294bn Amid Bullish Trend

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The Nigerian equity market continued its bullish momentum on Tuesday, delivering significant gains for investors.

By the close of trading, the market capitalization of the Nigerian Exchange (NGX) surged by N294 billion to settle at N55.65 trillion.

Concurrently, the All-Share Index (ASI) rose by 0.53%, reaching a new high of 98,383.04 basis points.

Surge in Trading Volume

Market participation saw a remarkable increase, with the volume of traded units soaring by 52.49% to 559,608,966 units.

This heightened activity underscored the bullish sentiment that dominated the day’s trading, with the NGX recording 28 gainers compared to 14 losers.

Top Gainers and Losers

Leading the pack of gainers was Dangote Sugar, which appreciated by 10% to close at N42.90 per share. Morison Industries Plc also saw a significant rise, with its stock price increasing by 9.88% to N4.45.

Similarly, the National Salt Company of Nigeria (NASCON) experienced a 9.88% gain, ending the trading session at N37.25 per share.

On the flip side, Sovereign Trust Insurance was among the top losers, shedding 9.52% to close at N0.38 per share. Universal Insurance Plc followed with an 8.33% decline, closing at N0.33, while The Initiate Plc dropped by 7.08% to N1.71.

Sectoral Performance

The bullish activity was reflected across various sectors, with five indexes posting gains. The Banking and Oil and Gas sectors were the standout performers, rising by 2.4% and 1.9%, respectively.

This was largely driven by buy interests in stocks such as United Bank for Africa (UBA), First Bank Holdings, Seplat Energy Plc, and Japaul Gold and Ventures Plc. The Consumer Goods and Insurance indexes also saw gains, increasing by 1.1% and 0.7%, respectively.

Conversely, the Industrial Goods sector was the sole laggard, dipping by 0.20%. Despite this, the overall market sentiment remained positive, buoyed by robust performances in other sectors.

Most Traded Securities

Seplat Energy Plc emerged as the most traded security by value, with N1.60 billion worth of shares exchanged across 51 deals. In terms of volume, Abbey Mortgage Bank led the chart, with 277,527,586 units traded in eight deals.

Outlook

The continued bullish trend in the Nigerian equity market reflects growing investor confidence and optimism.

Analysts suggest that the positive performance could persist if the current market dynamics remain favorable.

However, they also caution that sustained growth will depend on broader economic stability and continued investor interest.

In summary, Tuesday’s trading session was marked by significant gains and heightened trading activity, underscoring the resilience and potential of the Nigerian equity market. As investors capitalize on these bullish trends, the market’s outlook remains cautiously optimistic.

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Nigerian Exchange Limited

Nigerian Exchange Suffers as Foreign Investment Drops 19% in April

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The Nigerian Exchange Limited (NGX) experienced a significant downturn in April with foreign investment inflows dropping by 19.14% month-on-month to N42.58 billion from N52.66 billion in March.

This decline reflects the waning confidence of foreign investors in the local equity market, despite the government’s ongoing efforts to stabilize the economy.

According to the Domestic & Foreign Portfolio Investment Report released by NGX, the decrease in foreign inflows has been accompanied by a dramatic rise in foreign outflows, which surged by 88.10% to N78.25 billion from N41.60 billion in March.

This sharp increase underscores the persistent low appetite of foreign investors for Nigerian equities, a trend that has been evident since the beginning of the year.

Foreign outflows have steadily risen from N37.33 billion in January to N40.88 billion in February, indicating a growing concern over the market’s volatility and economic stability.

The combined foreign transactions on the NGX showed an overall increase of 28.19% to N120.83 billion in April, up from N94.26 billion in the previous month.

However, this uptick was not enough to offset the bearish trend that dominated the market, leading to a loss of approximately N3.54 trillion.

Investors have been shifting their focus towards alternative markets that offer better yields and more stability.

Compounding the situation is the impending settlement of $1.30 billion worth of cleared USD/naira-settled non-deliverable forwards (NDF) contracts on the FMDQ securities.

These contracts, set to mature on Wednesday, could put additional pressure on the already strained naira.

Cleared naira-settled NDFs are agreements where parties commit to an exchange rate for a future date without the obligation to deliver the actual US dollar upon settlement.

Instead, the contracts are cash-settled in naira, with the settlement amount determined by the differential between the contract rate and the Nigerian Autonomous Foreign Exchange Fixing rate at maturity.

Financial market analyst Olaide Baanu highlighted the potential impact of this settlement, stating, “The settlement of $1.3 billion implies a cash payment of approximately N1.8 trillion from the Central Bank of Nigeria (CBN) based on the NAFEX rate of around N1,400/dollar. Such a significant cash outflow is likely to lead to further depreciation of the naira beyond the CBN’s target or desired range.”

The CBN may face challenges in managing the liquidity impact of this large payment. Baanu suggested that the central bank might need to intervene in the foreign exchange market to stabilize the naira’s value, possibly through measures to lower the official exchange rate or by issuing promissory notes to prevent excessive naira circulation at once.

Despite efforts to bolster non-oil revenues, the Nigerian economy remains heavily dependent on oil, which accounts for about 90% of the national budget.

The market’s recent performance reflects the urgent need for diversified revenue sources and more robust economic reforms to restore investor confidence and stabilize the currency.

The ongoing economic challenges underscore the importance of effective policy implementation and transparent governance to attract and retain foreign investment.

As the NGX navigates this turbulent period, stakeholders are closely watching for signs of stability and growth that could reignite investor interest in the Nigerian market.

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