Stock Market

Nigerian stock market extends loss by 0.40%

by with No Comment BusinessfinanceNews

Nigerian stock market extended negative trend for the third consecutive trading session following sell pressure on Nigerian Breweries, Dangote Sugar Refinery and tier-1 banks.

READ ALSO: Small businesses get N53b to create 1 million jobs

The All-Share Index on Thursday declined further by 157.39 points or 0.40 per cent to close at 39,394.67 from 39,522.06 posted on Wednesday.

Accordingly, the month-to-date and year-to-date losses increased to 1.1 per cent and 2.3 per cent, respectively.

In the same vein, the market capitalisation shed N83 billion to close at N20.595 trillion against N20.678 trillion recorded on Wednesday.

The market loss was driven by price depreciation in large and medium capitalised stocks amongst which are; Presco, Nigerian Enamelware, Nigerian Breweries, Julius Berger and Ardova.

Consequently, market sentiment was negative with 47 losers in contrast with 13 gainers.

Fidson Healthcare led the losers’ chart in percentage terms with 10 per cent to close at N4.41 per share.

Northern Nigeria Flour Mills followed with a decline of 9.97 per cent to close at N6.32 per share.

NEM Insurance and Nigerian Enamelware shed 9.95 per cent each to close at N1.72 and N19.90 per share, respectively.

NCR declined by 9.91 per cent to close at N3.09 per share.

Conversely, University Press dominated the gainers’ chart in percentage terms with 9.91 per cent to close at N1.22 per share.

Morison Industries followed with 9.09 per cent to close at 60k, while Chemical & Allied Products increased by 5.26 per cent to close at N20 per share.

Lafarge Africa grew by 3.59 per cent to close at N20.20, while livestock Feeds rose by 3.17 per cent to N2.28 per share.

Transactions in the shares of Universal Insurance topped the activity chart with 83.26 million shares valued at N16.65 million.

Zenith Bank followed with 38.65 million shares worth N983.25 million, while FBN Holdings traded 31.25 million shares valued at N216.72 million.

United Bank for Africa accounted for 26.78 million shares valued at N211.57 million while Access Bank transacted 21.59 million shares worth N168.09 million

Meanwhile, the total volume of traded increased by 101.8 per cent as investors bought and sold 493.17 million valued at N4.72 billion exchanged in 5,486 deals.

This was against a total of 244.34 million shares worth N4.13 billion traded in 4,714 deals on Wednesday. (NAN)

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Global Market

Price of petrol could rise as uncertainty looms in the global market

by with No Comment BusinessNews

On Sunday, 28 February 2020, Nigerian oil marketers announced that Premium Motor Spirit (PMS) or petrol may go on sale for as much as N230 per litre in March.

READ ALSO: FUGAZ investors lose N34.68 billion in trading

The announcement was made after the Nigerian National Petroleum Corporation (NNPC), the same day, assured Nigerians in a press release that despite the increase in the price of crude oil, it has no plans to increase the ex-depot price of petrol in the month of March.

The state-controlled oil company had initially made a similar promise, early in February.

However, most filling stations across the country have reported the presence of a large queue of buys as people engage in panic buying.

The announcement has equally prompted some filling stations to engage in petrol hoarding.

The Federal Government in March 2020, announced the removal of fuel subsidy and full deregulation of the downstream sector of the oil industry, which will allow market forces to determine the price of the product.

According to a report, Mike Osatuyi, the National Operations Controller, Independent Petroleum Marketers Association of Nigeria (IPMAN), “Nigeria has crossed the bridge, there is no hiding place and the N1.2 trillion which was hitherto annual spending on subsidy, will be borne by the market.” 

Further commenting, Osatuyi stated that the rise in the prices of crude oil to $67 per barrel as of Sunday, 28 February makes it normal for the price of PMS to be between N220 per litre and N230 per litre

Currently, the world is expecting the Organization of Petroleum Exporting Countries (OPEC) and its allies to increase oil production as the excess crude that piled up during the pandemic as borders were shut down has disappeared.

As the world rally for more supply of crude oil, traders expect the OPEC+ coalition (led by Saudi Arabia and Russia) to agree to an increase in production when it meets on March 4.

If this is done it would be reversing some of the output cuts made in 2020 by the international body, likely reducing the global crude price and necessitating an increased output that oil-dependent countries like Nigeria could benefit from.

However, Prince Abdulaziz bin Salman, of Saudi Arabia has urged fellow oil-producing states to remain “extremely cautious” as it is not clear what level of impact the COVID-19 (coronavirus) pandemic could have on the global demand for oil if the output is increased.

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FUGAZ INVESTORS

FUGAZ investors lose N34.68 billion in trading

by with No Comment News

Market capitalization of the top five banks dropped to N2.52 trillion as at close of business on the 4th of March 2021.

READ ALSO: CBN extends forbearance for intervention loans by another 12 months

Investors in the elite banks in Nigeria- FBNH, UBA, GTB, Access and Zenith have lost a total of N34.68 billion in a single trading session, amid sell-offs.

According to data from the Nigerian Stock Exchange (NSE), the market capitalization of the top five banks dropped to N2.52 trillion as at close of business on the 4th of March 2021, shedding about 1.6% in a single trading session.

The loss is due to downward pressure on the share prices of the elite banks, evident by the sell-off witnessed in the market. A snapshot of how much each bank lost and the impact is succinctly captured below;

UBA

The United Bank for Africa investors lost a total of N10.26 billion after its market capitalization dropped from N282.15 billion to N271.9 billion as at close of business yesterday.

The drop is due to a sharp decline in its share price which closed at N7.95, shedding about 3.64% in a day.

Investors cashed in on the decline to trade about 26,782,197 units of the Bank’s shares valued at N211, 571,939.35, placing the bank as the fourth most traded stock at the NSE. The volume of shares traded by the bank rose astronomically by 201.9%, when compared to 8.87 million units traded the previous day.

On the other hand, it is pertinent to note that the United Bank for Africa (UBA) is yet to release its audited FY 2020 result.

Access Bank

Access Bank Nigeria Plc lost a total of N8.89 billion after its market capitalization dropped from N286.14 billion to N277.25 billion. The loss is due to a decline in its share price from N8.05 to N7.80, indicating a dip of 3.11%.

Just like UBA, Access Bank investors traded a total of 21,586,491 units valued at N168, 090,266.60, placing it as the fifth most traded stock at the NSE today. In lieu of this, Access Bank stock volume appreciated by 229.1%, from 6.56 million traded yesterday.

Access Bank is yet to release its audited financial statements for FY 2020.

Zenith Bank

Zenith Bank investors lost a total of N7.85 billion after market capitalization dropped to N794.3 billion today. The marginal drop is due to a slight dip in the firm’s share price, from N25.5 traded yesterday to N25.30 as at close of business, indicating a decline of 0.98%.

Investors reacted to this drop by trading 38,647,711 units of the bank’s shares valued at N983, 251,467.75, placing the firm as the second most traded stock at the NSE market.

The drop in the market value of Zenith shares is in contrast to what was obtained last week, when investors gained a total of N37.7 billion, the highest recorded by the bank since the famous circuit breaker. The gains were sequel to an impressive financial performance by the firm for FY 2020, after it recorded a PAT of N230.6 billion and declared a final dividend of N2.70 per share.

FBNH

FBNH investors lost N1.8 billion after its market capitalization declined to N253.06 billion as at the close of business. The drop was due to a 0.7% decline in its share price from N7.1 traded earlier to N7.05.

In lieu of this, a total of 31,253,644 units of the bank’s shares valued at N983, 251,467.75 were traded, placing the firm’s stock as the third most traded stock at NSE. The total volume traded surged by 88.9%, from a total of 16.54 million traded a day earlier.

FBNH had earlier declared a Profit After Tax figures of N79.71 billion for FY 2020, indicating an increase of 8.2% YoY.

GTB

GTB investors lost a total of N5.89 billion, following a drop in its market capitalization from N932.97 billion to N927.08 billion. The drop was due to a 0.63% decline in share price which closed at N31.50.

It is pertinent to note that GTB is yet to release its audited financial statement for FY 2020.

What you should know

  • The Nigerian Stock Exchange ended on a bearish note on Wednesday, March 4, 2021 after the ASI declined by 0.40% to close at 39,364.67 index points.
  • On a general note, investors lost a total of N82.35 billion, with FUGAZ accounting for 42.11% of the loss.

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CBN

CBN extends forbearance for intervention loans by another 12 months

by with No Comment financeNews

The Central Bank of Nigeria (CBN) has announced an extension of its regulatory forbearance for the restructuring of its intervention facilities by another 12 months.

READ ALSO: Nigeria’s equities market loses over N200bn in 4 days

In a circular signed by Dr. Kevin Amugo, the Director of Financial Policy and Regulatory. the apex bank said it will continue to charge its borrowers an interest rate of 5% per annum as against the 9% originally offered.

The CBN had on March 20th reduced the interest rates on its intervention loans from 9% to 5% as part of its response to the economic crunch brought on by Covid-19 induced lockdowns.

The banking sector regulator also offered to rollover moratorium granted on all principal payments on a case by case basis. All credit facilities had been granted a one-year moratorium starting from march 1, 2020 when the pandemic first gripped Nigeria.

Below is excerpt from the circular:

“The Central Bank of Nigeria reduced the interest rates on the CBN intervention facilities from 9% to 5% per annum for one-year effective March 1, 2020, as part of measures to mitigate the negative impact of COVID-19 Pandemic on the Nigerian economy.”

Credit facilities, availed through participating banks and OFIs, were also granted a one-year moratorium on all principal payments with effect from March 1, 2020.

Following the expiration of the above timelines, the CBN hereby approves as follows:
1) The extension by another twelve (12) months to February 28, 2022 of the discounted interest rate for the CBN intervention facilities;

2) The roll-over of the moratorium on the above facilities shall be considered on a case by case basis.

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Equity Market

Nigeria’s equities market loses over N200bn in 4 days

by with No Comment financeNews

Listed stocks on the Nigerian equities market have lost approximately N228billion within just four (4) trading days into this new month as sell-side activities increase.

READ ALSO: Key to SME growth in Lagos State

The market furthered into the negative region after Thursday’s dip by 0.41percent. Month-to-date (MtD), it has decreased by 1.09percent while year-to-date (ytd), it is down by 2.25 percent.

As the bears gradually regain position on Custom Street, the stock market of Africa’s largest economy is not far from closing the first week of March in red. The market is worse off as investible funds continue to move out of equities due to impressive yields in the fixed income market.

“Nigerian equities have since maintained a southward direction, losing 5.6percent in February 2021… The question on many investors’ minds is largely to know if this is a temporary lull, a correction, or a significant crash”, according to United Capital research analysts.

READ ALSO: SME Sensitization Tour’ at Osisatech Enugu

The analysts had reiterated that the sustained reversal in the yield environment weakens investors’ interest in equities.

“We view the current bearish performance in the market as a correction that is likely to extend through the period when yields in the fixed income market stabilize. We recognize this as an opportunity for investors to take advantage of lower prices to buy into stocks forecasted to deliver solid earnings in 2021, employing a patient approach in building up positions”, United Capital research said in a recent note.

The NSE All-Share Index (ASI) and Market Capitalisation which opened this week at 39,799.89 points and N20.823trillion respectively stood lower at 39,364.67 points and N20.595trillion at the close of trading session on Thursday. In 5,486 deals, investors exchanged 493,172,597 units valued at N4.722billion.

Fidson Healthcare led the laggards after its share price moved down from N4.9 to N4.41, losing 49kobo or 10percent. Northern Nigeria Flour Mills followed, after its share price decreased from N7.02 to N6.32, losing 70kobo or 9.97percent, while Nigerian Enamelware lost N2.2, from N22.1 to N19.9, down by 9.95percent.

NEM Insurance share price decreased from N1.91 to N1.72, losing 19kobo or 9.95percent, while NCR lost 34kobo or 9.91percent, after moving from N3.43 to N3.09.

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SME Academy

P&G Nigeria Partners FG, BoI to Start SME Academy

by with No Comment News

Leading manufacturers of trusted quality brands in Nigeria, Procter & Gamble (P&G) Nigeria, in partnership with the Federal Ministry of Trade and Investment (FMITI) and the Bank of Industry (BoI), has initiated an SME Academy program to find sustainable solutions to unlock the efficiency and performance of small and medium scale businesses in the country.

A statement from the company said the training, which took place on October 3, 2019, in Ibadan Oyo State, is a follow-up to the agreement made with the federal government earlier in the year.

READ ALSO: SME Sensitization Tour’ at Osisatech Enugu

The goal of the SME Academy is to find sustainable solutions to unlock the efficiency and performance of these enterprises through advisory and skills development, as these are key constraints to the growth of SMEs in Nigeria.

Managing Director of P&G Nigeria, Mr Adil Farhat, said, “The development of SMEs through capability building is a demonstration of Procter & Gamble’s commitment to transforming Nigeria’s Entrepreneurship ecosystem.

READ ALSO: NBS, SMEDAN, to Confirm Number of MSMEs in Nigeria

“When we decided to impact SMEs in Nigeria with support from the Federal Ministry of Industry, Trade and Investment, we were interested in developing an empowering model that would accommodate as many entities as possible.

“Our partnership with the Bank of Industry is strategic, as they have the capacity and expertise that would accelerate this vision into sustainable realities; which aligns with our goals for this program”.

Speaking on the objectives of the program, the Regional Manager (West) of the Bank of Industry (BOI), Mr Kagara Ahmed said: “It is important for SMEs to focus on knowledge acquisition to optimize their people, physical resources, processes, and products/services in order to guarantee sustainable business profits.

“BOI is committed to the development of SMEs in Nigeria because we believe that a vibrant SME sector is critical to the transformation of Nigerian industrial sector. The focus of today’s SME Academy is to effectively enhance the management systems of SMEs to ensure that their operational processes from initiation to completion is of quality and sustainable standards.”

Among its other objectives for the initiative, Procter & Gamble aims to provide practical guidance designed specifically for highly innovative SMEs with sustainable ambitions that are determined to turn strong, innovation towards total economic activity.

The SME sector has become increasingly important to economies around the world, with a World Bank Study estimating their presence to be between 365-445 million in emerging markets. It is also the leading source of employment in Nigeria, amassing over 80% of the region’s workforce.

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Microsoft

Nigerian team builds technology for Microsoft

by with No Comment News

Microsoft Mesh, a new mixed-reality platform powered by Azure – that allows people in different physical locations to join and share holographic experiences on many kinds of devices, was launched on Tuesday by Microsoft.

READ ALSO: Millions of MSMEs pushed to the brink amid lockdown

The team of engineers behind the technology mostly worked from Lagos, Nigeria’s most populated commercial city.

Mixed-reality technology allows real and virtual elements to interact with one another and the user to interact with virtual elements like they would in the real world. The new technology essentially changes the experience people would have in a virtual meeting where they can only participate with their voices.

With the Microsoft Mesh launched, participants would not only speak to one another, but they also get to be in the same virtual room and interact with virtual objects like in real life. In that sense, Mesh is more than an app for holding virtual meetings. It is an all-encompassing platform built on top of Azure that Microsoft is hoping developers will tap into.

“Today, the world finally gets to hear about Microsoft Mesh. Our incredible engineering team here in Lagos has been working tirelessly towards this day for a very long time. So proud of what we have accomplished,” Hoop Somuah, engineer manager, tweeted on Tuesday.

Somuah, who joined Microsoft as a software engineer in June 2003, became the software engineering manager in January 2019. He also heads the mixed-reality team in Nigeria. Microsoft maintains engineering teams in Nigeria and Kenya.

Mesh is likely the future of the Microsoft Team – the company’s virtual meeting app. Microsoft is hoping architects, engineers and designers will all see the promise of Mesh, particularly during a pandemic when it is difficult to work with 3D physical models without all being in the same room.

“This has been the dream for mixed reality, the idea from the very beginning,” said Microsoft technical fellow, Alex Kipman. “You can actually feel like you are in the same place with someone sharing content or you can teleport from different mixed-reality devices and be present with people even when you are not physically together.”

The new platform is the result of years of Microsoft research and development in areas ranging from hand and eye-tracking and HoloLens development to creating persistent holograms and artificial intelligence models that can create expressive avatars.

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MSMEs

NBS, SMEDAN, to Confirm Number of MSMEs in Nigeria

by with No Comment BusinessNews

The process of authenticating claims by the Small and Medium Enterprises Development Agency (SMEDAN) that Nigeria has 37 million Micro, Small and Medium Enterprises (MSMEs) has commenced.

The nation’s stats office, National Bureau of Statistics (NBS), is assisting in confirming this figure.

READ ALSO: $1.4bn deal, sealed to produce ammonia

Last month, Director-General of SMEDAN, Mr Dikko Radda, disclosed at a conference in Abuja that there were about 37.1 million MSMEs operating in the country.

Mr Radda made this disclosure at the India-Nigeria Cultural Conference organised by the All India Universities Alumni Association, Abuja Chapter, themed ‘Micro, Small and Medium Enterprises in combating unemployment in Nigeria: India experience.’

“There are presently about 37.1 million MSMEs in Nigeria. That is huge.

“Their contribution to the Gross Domestic Product is about 48.7 percent, while their contribution to export is about 7.2 percent.

“That is to tell you how significant they are to our economy,” Mr Radda had stated at the conference.

He based his figure on the last national survey conducted in January 2014, where it was revealed that 37.1 million enterprises operating in the economy were employing 59.7 million persons.

Speaking at a one-day workshop on MSMEs Survey yesterday, Mr Radda said in the survey that will commence nationwide soon, two micro enterprises sub-class would be categorized instead of the former undifferentiated micro-enterprises class.

According to the SMEDAN chief, who was represented at the event by Mr Wale Fasanya, a senior employee of the agency, “This will help distinguish an establishment-leaning microenterprise sub-class (or salaried paid employment) from the other microenterprise sub-class of unpaid or part-time household members.”

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Amonia

$1.4bn deal, sealed to produce ammonia

by with No Comment News

The Nigeria Sovereign Investment Authority (NSIA) has sealed a $1.4bn deal with the OCP of Morocco as well as the Akwa Ibom State government to develop a plant where ammonia and diammonium phosphate will be produced.

Partners in the deal also include the Nigerian National Petroleum Corporation (NNPC), Nigerian Content Development & Monitoring Board (NCDMB), Gas Aggregation Company Nigeria Limited (GACN), and Fertilizer Producers & Suppliers Association of Nigeria (FEPSAN).

Read Also: How NON-profits can manage their fund raising

The new deal comes under NSIA Gas Industrialization Strategy and will drive implementation of the Multipurpose Industrial Platform project, a backward integration initiative which builds on the successes of the Presidential Fertilizer Initiative (PFI) and other sovereign bilateral initiatives between Nigeria and Morocco.

The project is structured to commercialize Nigeria’s vast natural gas resources and satisfy Morocco’s demand for cost-competitive ammonia.

Five crucial agreements were signed under the deal designed to create a clear path for the second phase of the Presidential Fertiliser Initiative as well as the creation and operationalization of a Multipurpose Industrial Platform (MPI) in Nigeria. The MOUs were signed Tuesday at the Mohamed VI Polytechnic University (UM6P) in Benguerir, Morocco.

The first phase of the project will produce 1.5 million tons per annum of ammonia in two phases. Up to 70 percent of the ammonia produced will be allocated for export to Morocco and the balance will be routed to the production of 1 million tons per annum of di-ammonium phosphate (DAP) and NPK fertilizers to feed domestic demand.

“It is expected that project construction will commence no later than Q3, 2021,” NSIA noted in a statement.

“US$1.4 billion will be invested in building out the plant and its supporting infrastructure with a target operations-commencement date of 2025.”

The project will be sited in the gas-rich Akwa Ibom State. Land availability and accessibility; gas adequacy; sufficiency of marine draft; and other environmental and social considerations informed the decision to site the plant in Akwa Ibom.

At completion, the integrated ammonia and fertilizer plant will house – within its battery limits – the process plants for ammonia and fertilizer production, administrative buildings, fertilizer bagging units, water purification units, storage for raw materials and finished goods, onsite power plant and other ancillary facilities.

Read More Here

Oil Spillage

Oil spillage is still a thing in the Niger Delta

by with No Comment News

Just last week, we reported on the resurfacing of Niger Delta freedom fighters stating the injustices their region grapple with and how they have been marginalised, not to mention the failure of the amnesty program.

READ ALSO: Business legislation will give govt “dramatic authority”

It was an opportunity – and still is – for the present administration to reacquaint themselves with the deteriorating conditions of Niger Delta communities, ranging from lack of infrastructure, loss of livelihoods, or absence of social services, arising from crude oil exploitation largely caused by the activities of international oil companies.

This is well-documented.

At this point, the Niger Delta should be prioritised in the context of ecological reparations, which simply means fully giving land, financial and material compensations to indigenes after years of environmental toxicity and destruction.

But this can’t be actualised when the politicians still appear oblivious of what’s happening, or are only just finding out and would most likely do nothing. As in the case of Eti-Osa Federal Constituency, Lagos Representative, Ibrahim Babajide Obanikoro, who in a recent tweet went to the South south and saw for himself an incident of oil spillage committed by international oil companies.

While Obanikoro’s experience further legitimises the situation in the Niger Delta, his show of empathy will surely not improve the living conditions of the people who can no longer fish in creeks or rivers, or use lands.

Only a sincere policy drive from the government can make the difference. The oil spillage in the Niger Delta often occur during extraction and for those who reside in waterfront settlements, because of how cheap or accessible shelter are there, they are faced with this kind of environmental pollution.

Ecological reparations as a pillar of environmental justice means channeling resources to restore the integrity of rivers.

As it is, Niger Delta freedom fighters are agitating against the continued exclusion from benefitting from their region’s natural resource. And it’s time the government listened.

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