Investors’ desire for higher capital gains and new listings boosted market activity in Q1’22, reports CHRIS UGWU
The Nigerian stock market, which closed positive in the year 2021 with a sizeable gain, continued the upward trend in the first quarter of 2022 with a gain of 3.015 trillion naira as investors took advantage of low commodity prices. shares, mainly supported by the listing of BUA Aliments Plc.
Statistics obtained by New Telegraph showed that trading on the Nigerian Stock Exchange, which opened the year at 22,296 billion naira in market capitalization and 42,716.14 in index at the start of trading on January 4, 2022, closed on March 31, 2022 at 25 naira. 0.311 trillion and 46,965.48 index points, thus gained a quarterly gain of approximately 3.015 trillion naira or 10%. Positive sentiments were maintained in the local stock market as the gradual release of full-year corporate earnings boosted buying interest in dividend-paying stocks.
Equity trading recorded a gain of 2.828 billion naira in January, the highest in the quarter, as investors continued to increase their buying pressure, particularly on blue chip stocks. The local stock market recorded a gain of 419 billion naira in February following buying pressure from investors on the expectation of corporate results for the year 2021.
However, weak sentiment took center stage following investor profit taking as the market recorded a loss of N232 billion during the month of March 31, 2022 despite the release of impressive results for the market. year 2021 by some blue chip companies.
Market analysts believe that renewed sentiments had also increased following the thirst for higher capital gains due to low share prices due to financial market disruption resulting from the widespread pandemic and the sharp drop in the price of oil.
The listing of BUA Foods also added 720 billion naira to NGX’s market capitalization during the quarter, further increasing liquidity in the Nigerian capital market and providing opportunities for wealth creation. It is expected that the listing will also increase the visibility of the food manufacturing, processing and distribution company, BUA Foods, to investors on the African continent and around the world.
BUA Foods adds N720 billion to its capitalization
Nigerian Exchange Limited (NGX) in January announced the listing by IPO of BUA Foods Plc on the Main Board of the Exchange. A total of 18 billion common shares of BUA Foods were listed at N40.00 per share in the consumer goods sector of NGX, with the trading symbol BUAFOODS.
The listing of BUA Foods shares added 720,000,000,000 naira to the market capitalization of NGX, further increasing liquidity in the Nigerian capital market and providing opportunities for wealth creation. It is expected that this listing will also increase the visibility of the food manufacturing, processing and distribution company, BUA Foods, to investors on the African continent and around the world. NGX has facilitated over N7 trillion in capital raisings across multiple asset classes for public and private companies in 2021.
As a multi-asset exchange, NGX is strategically positioned to be the preferred listing and investment destination connecting Nigeria, Africa and the world. Commenting on the listing, Abdul Samad Rabiu, President of BUA Group, said, “I am delighted that another member of BUA Group has been listed on NGX.
This shows our commitment to national economic growth and our support for the country’s food security campaign, in line with global sustainability goals.
“We appreciate the continued support of our partners, financial advisors, stockbrokers, vendors, customers, consumers and staff members. In particular, we cherish our host communities with whom we continue to build very strong and mutually beneficial relationships.
NGX Managing Director Mr. Temi Popoola congratulated BUA Foods Plc for taking the bold step of joining its subsidiary, BUA Cement, as a listed company on the Stock Exchange.
He added, “The listing of BUA Foods Plc on the Stock Exchange reaffirms the confidence that leading Nigerian companies have in NGX as the partner of choice to raise capital and enable sustainable growth and development.
“I must commend the efforts made by the management of BUA Foods for this listing and the roles played by all professional parties in this transaction, in particular; Stanbic IBTC Capital Limited, Rand Merchant Bank Nigeria Limited, UCML Capital Limited, APT Securities Limited and CardinalStone Securities Limited.
133 merchants inducted
NGX in February inducted a total of 133 licensed trading clerks from 63 trading license holders, instructing them to uphold the highest standard of ethics and accountability. Speaking at the ceremony, NGX Chief Executive Officer Mr. Temi Popoola said, “On behalf of NGX’s Board of Directors and senior management, I would like to congratulate all of today’s inductees. today. We are indeed delighted to celebrate the success of trading clerks who have gone through the Exchange’s Automated Trading System training faculty comprised of seasoned capiafters
manufacturing market regulators and operators, including the Securities and Exchanges Commission (SEC); Chartered Institute of Securities Dealers (CIS); Association of Securities Brokers of Nigeria (ASHON); Central Securities Clearing System (CSCS) Plc and Registrars.
This initiation is proof of years of dedication, adaptability and hard work, and symbolizes your commitment to upholding the highest ethical standards and always putting the interests of the market first. Popoola also advised new clerks to embrace the culture of continuous learning in the rapidly changing environment that is the capital market saying, “As the market deepens with the launch of new products, I ‘encourages everyone to seek a better understanding of various aspects of the capital market as well as new developments.
“The X-Academy, our specialist learning center, is equipped to fill this gap by offering a wide range of courses aimed at filling the knowledge gap of financial market professionals, investors and the general public on how the market works. Be sure to maximize the opportunities presented by X-Academy to stay up to date on market developments.
Electronic Financial Statement
The Securities and Exchange Commission (SEC), during the quarter, informed all capital market operators that the SEC had created a dedicated account for the submission of annual financial statements. In a notice obtained from the SEC’s website, the Commission noted that all audited financial statements should be submitted electronically.
“The financial statement must be in a selectable and searchable PDF format, which must not exceed 15MB. SEC regulations, the SEC noted in a statement signed by management.”
Following the pilot program on the filing of fourth quarter and annual audited financial statements by public companies introduced in March 2019, the Securities and Exchange Commission (SEC) recently informed all public companies of the options available on the filing of audited financial statements fourth quarter and annual. Financial state.
According to the Commission, the options are either to file the unaudited fourth quarter financial statements within 30 days of the end of the quarter and to file the annual audited financial statements within 90 days of the end of the year, or to not not file unaudited fourth quarter statements but file annual audited financial statements within 60 days of the end of the fiscal year.
“Therefore, public companies are advised to adopt a filing regime and strictly adhere to its preferred filing option. “Public companies should note that failure to comply with an adopted deposit scheme will be considered a breach of Section 60 of the Investments and Securities Act 2007,” the Commission noted.
Operator reactions
Speaking on the market’s performance in the first quarter of 2022, Chief Operating Officer of InvestData Consulting Limited, Ambrose Omordion, said the stock market maintained positive sentiment and an upward trend due to the influx of corporate actions and audited financial statements from 2021, as players reacted to the figures released. and dividend declared for 2021 year-end results.
Omordion said this should support an uptrend during earnings season amid the swing in oil prices, just as the market continues to interpret economic data in relation to the price of crude oil and oil prices. other factors, amid profit taking and portfolio rebalancing.
“This led market participants to target fundamentally sound, dividend-paying stocks, with fourth quarter 2021 GDP rising 3.98%, while the International Monetary Fund called for higher interest rates and further devaluation of the naira,” he added. On the market outlook, Omordion predicted a mixed sentiment exchange from investors in April and beyond, saying all eyes would be on the performance of the economy and how managers the country’s economy would respond to challenges, including insecurity and overseas activities. According to him, investors would also be concerned about the ongoing war in Ukraine, the distortion of the energy supply chain which had been one of the main factors behind inflation, insecurity, among other factors. which have driven up the cost of production, goods and services. He added, “To invest profitably in this changing environment, you need investment education, trading plans and trading tools/software. These will help manage the risks associated with the volatility and volatile markets.” An analyst at PAC Holdings, Mr Wole Adeyeye, said investors had priced in the payment of dividends by listed companies, which he said boosted market performance.
Adeyeye said: “Investors have already priced in the dividend in January and February and that is why the market maintained positive growth over the period. However, there was some profit taking in March as most of investors did not bother to wait for the dividend payment date.
He predicted that in April, the stock market could witness cautious trading by investors due to the uncertainties surrounding the economy. Bottom Line Regulators should continue to encourage investors to foster access to diverse investment opportunities and build investor confidence in the capital market.
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