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Nigeria: GT Bank Holding Firm Lists On Nigerian Exchange

GT Bank Plc has transited into a holding company (HoldCo) structure from its commercial banking structure and listed its shares on the Nigerian Exchange Limited (NGX) with the name Guaranty Trust Holding Company (GTCO) Plc.

Speaking to newsmen during the closing gong ceremony to commemorate the listing of GTCO Plc on the NGX in Lagos, the Group Chief Executive Officer (GCEO) of GTCO Plc, Segun Agbaje, said the transition will sustainably grow its earnings and achieve its long-term goal of becoming one of the top five financial institutions in Africa.

He said the experience of trading on the NGX has been really good and that GTCO Plc was very excited about the opportunities that have opened up with the restructuring, particularly because diversifying its income base has always been a major priority.

Responding to a question from a stockbroker, Rasheed Yussuf, the GCEO, said the creation of portfolios was key to anchoring the synergy between the capital market and money market.

“Hopefully we learnt something from the past and found a way to go back to doing that as there is no way a stock market can grow if it is only driven by people’s money. We must find a way to design leverage again and put it back.”

In his opening remark, the Chief Executive Officer, NGX, Temi Popoola, commended the board and management of GTCO Plc for its successful restructuring.

He said the NGX will continue to partner GTCO and other listed companies and issuers even as it continues to build a platform that allows listed companies, investors and other stakeholders to maximise value in the market.

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Nigeria: Nigerian Stocks Enter Fourth Day of Loss Amid Bank Shares Sell-Off

A couple of board meeting notices were published on Tuesday, signalling the issuing of companies’ financials is round the corner.

Nigerian stocks eased by N1 billion on Tuesday as equities faced increasing attrition from investors’ heavy disposal of bank and financial services shares, even though the depth of loss was very shallow, with the benchmark index dipping by as low as less than one per cent.

The bourse is yet to close on an upbeat note since the week began, raising fears stocks could return a negative yield at the end of the week unless a tremendous turnaround happens.

Ahead of the release of quarterly statements, a couple of board meeting notices were published on Tuesday, signalling the issuing of companies’ financials is round the corner.

On the flip side, market breadth which weighs the extent of investors’ confidence, was positive as 17 gainers were reported compared to 13 laggards.

The All Share Index inched down to 37.857.24 points and market capitalisation dropped to N19.724 trillion.

Year to date, the index is down 5.99 per cent.

TOP FIVE GAINERS

NCR led gainers, appreciating by 9.64 per cent to close at N2.73. Wema went up 9.46 per cent to N0.81. FTN Cocoa rose to N0.39, notching up 8.33 per cent in the process. NPF Microfinance added 6.88 per cent to end today’s trade at N1.71. Lasaco completed the top 5, climbing by 6.67 to N1.60.

TOP FIVE LOSERS

Ikeja Hotels was the worst-performing stock, declining by 9.09 per cent to close at N1.40. Custodian Insurance shed 6.15 per cent to close at N6.10. Jaiz Bank fell to N0.50, losing 5.66 per cent. Mutual Benefits slid to N0.40, recording 4.76 per cent depreciation. <a target=”_blank” href=”https://www.fbnholdings.com/”>FBN Holdings</a> closed at N7.20, going down by 4 per cent.

TOP FIVE TRADES

In total, 197.280 million shares estimated at N1.921 billion were traded in 3,567 deals.

Universal Insurance was the most active stock with 37.199 million units of its shares worth N28.059 million traded in 100 deals. GTCO’s 27.913 million shares, priced at N823.198 million exchanged hands in 310 transactions. UPDC had 13.852 million shares valued at N19.556 million traded in 119 deals. Fidelity traded 12.158 million shares estimated at N28.360 million in 123 transactions. UBA traded 9.581 million shares valued at N72.203 million in 152 deals.

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South Africa: JSE Retail Stocks Muted Despite Retailers Going Into Crisis Mode Amid Looting

While scenes of lawlessness in parts of KwaZulu-Natal and Gauteng play out on TV and social media around the country, the JSE – in particular the retail sector – has shown a remarkably muted reaction. This may well change.

The OBC Group is a supermarket franchise that has been serving township and commuter populations for the past 35 years – long before malls and big supermarket chains saw the value in the mass market.

Ten of its stores – a fifth of its nationwide network – have been looted, gutted with pick axes for copper wire and, in some cases, burnt to the ground. Of those destroyed, just two are company-owned – the other eight are owned by franchisees who live in the communities they serve.

“I have no words for you,” says Tony Da Fonseca, CEO of the OBC Group and a past chairman of the Franchise Association of SA.

“We did not sleep last night. We are just devastated… our owners and staff are devastated. These are community businesses, it will take them months to get back up and running. What will happen to their jobs? Where will people get food? We will work alongside them, but it…

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Nigeria: Declining Naira Value Forces Businesses, Companies to Parallel Market

With the value of the naira further declining to N504 to the dollar, businesses and corporates are resorting to sourcing foreign exchange at the parallel market as turnover at the Nigeria Autonomous Foreign Exchange (NAFEX) market continues to plummet.

This is as the 30-day moving average of the external reserves continue to decline. As at July 8, 2021, it had declined to $33.12 billion, down from $35.64 billion which it was at the beginning of the year. Total turnover as of July 8, 2021 at the NAFEX window also known as the Investors’ and Exporters’ window, decreased by 24.5 per cent to $526.79 million with trades consummated between N400 to N460 to the dollar.

Speaking at the bi-monthly forum of the Finance Correspondents Association of Nigeria (FICAN), immediate past director-general of the Lagos Chamber of Commerce and Industry (LCCI), Dr. Muda Yusuf, noted that the foreign exchange market faced liquidity constraints in the first half of 2021, with forex being inadequate to meet rising demand.

To him, “the supply of foreign exchange was inadequate to meet rising demand. The rate premium between the Nigerian Autonomous Foreign Exchange Rate (NAFEX) and the parallel market rate averaged around 20 per cent. Several businesses and corporates encountered difficulties in sourcing foreign exchange at the formal segment of the market and were forced to source the greenback at the parallel market.

“Foreign exchange illiquidity aggravates investment risk which could negatively impact asset quality in the banking system. Foreign currency-denominated loans account for about between 30 per cent and 35 per cent of banks’ loan book. Foreign exchange volatility is associated with risks relating to asset quality and financial stability.”

Yusuf, who spoke on ‘Nigerian economy in first half 2021 & outlook for the financial services sector,’ said financial service institutions need a conducive business climate to create more avenues for investment and that more profitable asset classes are needed for profitable investments to take place.

He further stressed the need to address the structural, policy, institutional and regulatory constraints in the business environment which would also result in a reduction in non-performing loans in the banking sector.

He, however, noted that despite the pandemic and the resultant effect on the economy, the Nigerian banking industry remained resilient.

Yusuf said the borrowing spree of the federal government was hurting the economy as it escalates the already high rate of inflation in the country.

According to him, the facility usually comes at a huge cost to the taxpayer as the government paid N480 billion interest on the N1.8 trillion facility granted to it through the ways and means window between January and May 2021.

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Nigeria: Stock Market Reverses Gains As Investors Book Profits

The stock market closed last week on negative note as the positive sentiments of the previous week could not be sustained.

The pullback followed profit-taking in blue-chip stocks, especially in banking and consumer goods sectors by some investors.

As a result, the Nigerian Exchange(NGX) Limited All-Share Index (ASI), which appreciated by 1.47 per cent two weeks ago, fell 0.57 per cent to close at 37,994.19, while market capitalisation shed N123.7 billion to be at N19.796 trillion last week.

However, the slowdown in momentum or correction, according to the analysts at InvestData Consulting, has created opportunities, for discerning investors to reposition in interim dividend paying stocks.

The analysts said there was no need to panic at this point because profit-taking is an integral part of stock market dynamics anytime, to drive oscillation that creates room for entry and exit.

“So investors and traders should not be carried away with any rally or rebound, but be guided by their investment objectives, while taking profit immediately reasonable profit targets are met (say 15-20 per cent) while keeping an eye on the preset stop-loss,” they said.

The analysts added that they expect a mixed trend, on profit-taking and repositioning for half-year earnings reporting season kicking off any time soon after forming a wave that supports an uptrend as bargain hunters take advantage of pullbacks to reposition ahead of second quarter (Q2) numbers.

Looking ahead, InvestData said: “Again, the way to go is target dividend-paying stocks and fundamentally sound companies with growth prospects in 2021, looking the way of mispriced equities ahead of interim dividend announcement. “This is especially given that despite the seeming improvements, fixed income yield continues to offer a negative real rate of return due to the galloping inflation.

“However, the strong and faster recovery may continue, depending on market forces, going forward, as propelled by expected Q2 earnings reports, until the next Monetary Policy Committee (MPC) meeting in the coming weeks.”

Also commenting on the outlook for the market this week, analysts at Cordros Securities said with the moderation in the prices of bellwether stocks last week, they expected savvy investors to take advantage of this and make re-entry ahead of their H1-21 earnings announcement.

“However, we do not rule out the possibility of continued profit-taking activities. As a result, we think the local bourse will likely exhibit a zig-zag pattern. Therefore, we advise investors to take positions in only fundamentally justified stocks,” they said.

Meanwhile, investors traded 1.348 billion shares worth N12.140 billion in 21,581 deals were traded as against 1.021 billion shares valued at N14.145 billion that exchanged hands last week in 17,565 deals the previous week.

However, the Financial Services Industry led the activity chart with 892.212 million shares valued at N7.065 billion traded in 11,592 deals, thus contributing 66.2 per cent and 58.2 per cent to the total equity turnover volume and value respectively. The ICT Industry followed with 110.067 million shares worth N776.402 million in 744 deals. The third place was Conglomerates Industry, with a turnover of 100.008 million shares worth N216.504 million in 788 deals.

A look at the price movement chart showed that 44 equities appreciated in price during the week, higher than 43 in the previous week, 22 equities depreciated in price lower than 26 equities in the previous week.

UPDC Plc led the price gainers with 40.7 per cent, trailed by Cutix Plc with 21 per cent, while Redstar Express Plc led the price losers with 15.2 per cent, followed by Eterna Plc with 14.8 per cent.

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Nigeria: Nigerian Stocks Deepen Loss By U.S.$601 Million As Investors Take Profit

The all-share index toppled by 475.68 basis points to close at 37,994.19.

Nigerian stocks weakened further on Friday as the benchmark index narrowed by 1.24 per cent, taking a bashing from investors’ frantic efforts to swiftly dispose shares and cash in after gains had gradually accumulated for some days.

Shares began to plateau on Thursday, but the downward shift gained pace by as much as N247 billion the session after as the bears stormed the mark in full force with their eyes on the heaps of gains garnered in the nine days to July 4.

At the forefront of the retreat was Airtel Africa, with Vitafoam, NAHCO and Eterna also stoking the loss.

Market breadth, which measures the depth of investors’ faith in the market, closed on a negative note was as 21 losers emerged, compared to 20 gainers.

The all-share index toppled by 475.68 basis points to close at 37,994.19, while market capitalisation closed at N19.796 trillion.

Between January and now, the index is down 1.24 per cent.

TOP FIVE GAINERS

FTN Cocoa led the gainers’ chart, appreciating by 9.68 per cent to close at N0.34. John Holt went up by 8.96 per cent to N0.73. Unity Bank rose to N0.59, notching up 7.27 per cent.

Neimeth added 5.88 per cent to end trade at N1.80. WAPIC completed the top 5, climbing by 5.36 per cent to N0.59.

TOP FIVE LOSERS

Airtel Africa led losers, declining by 9.99 per cent to close at N601. NAHCO shed 9.65 per cent to close at N2.34.

NEM fell to N2, losing 9.09 per cent. Regal Insurance slumped to N0.45, recording 8.16 per cent decline. Wapic closed at N3.11, going down by 6.04 per cent.

TOP FIVE TRADES

GTCO was the most active stock with 30.971 million of its shares worth N909.731 million traded in 279 deals. Courteville traded 22.179 million shares priced at N4.845 million in 34 transactions.

Chams had 12.001 million shares valued at N2.401 million traded in 24 deals. Fidelity traded 11.506 million shares estimated at N26.602 million in 98 transactions. Transcorp traded 10.942 million shares valued at N10.209 million in 86 deals.

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South Africa: Imperial Buyout Offer – Foreign Investors Continue to Support SA Inc By Purchasing ‘Cheap’ Companies

JSE-listed logistics giant Imperial is the latest to be targeted by Dubai-based DP World, which has tabled an all-cash R12.7-bn buyout offer. DP World is one of the world’s largest operators of marine ports, inland cargo terminals and logistics centres.

Foreign investors are again looking at the JSE for buyout opportunities, taking advantage of share valuations that have been decimated by the Covid-19 pandemic.

Dutch brewing company Heineken has not been deterred by SA’s five bans on alcohol sales since the start of the Covid-19 as it recently expressed an interest in acquiring Distell, the maker of brands including Klipdrift brandy, Savanna cider and JC le Roux sparkling wines.

JSE-listed logistics giant Imperial is the latest to be targeted — by Dubai-based DP World, which has tabled an all-cash R12.7-billion buyout offer. On Thursday, DP World said it had offered Imperial shareholders R66 per share — a 39.5% premium to Imperial’s close of R47.30 on Wednesday.

Imperial shares finished 34% higher on Thursday to R63.25, adding R3.3-billion to its market value (R12.8-billion). The approval of the deal by Imperial shareholders and South Africa’s competition authority will result in the delisting of the company from the JSE after 34 years.

“Foreign…

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Zimbabwe: Caledonia Moves to Victoria Falls Stock Exchange

Caledonia Mining Corporation Plc, which owns Blanket Gold Mine in Gwanda, has begun the process of listing on the Victoria Falls Stock Exchange (VFEX).

The bourse, which is a subsidiary of the Zimbabwe Stock Exchange (ZSE), was established last year in October as an off-shore biased financial services centre.

Its setting up would go a long way in buttressing the Victoria Falls Special Economic Zone. In a statement, Caledonia said listing on the VFEX, which is for foreign as well as domestic investors in Zimbabwe with all transaction denominated in US dollars, would be conditional upon market conditions.

“Caledonia announces it is commencing the process of pursuing a listing of depositary receipts representing the company’s shares on the VFEX in Zimbabwe,” it said.

“Such a listing would be conditional upon market conditions and the implementation of positive proposals made by the Zimbabwe authorities in respect of improved payments in US dollars for gold produced at the company’s majority owned Blanket Mine.”

The mining group said the proposed VFEX listing demonstrates Caledonia’s continued commitment to Zimbabwe and would allow Caledonia and Blanket’s employees in the country to participate more easily as shareholders.

“Securing the VFEX listing is expected to take place during the course of 2021 and would be effected by a placing in Zimbabwe of depositary receipts to raise approximately US$3 million (to satisfy the requirements for local shareholder spread) and a subsequent introduction,” said the company.

“The proceeds of the placing would be used for general corporate purposes,” it said.

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Zimbabwe: Caledonia Mine Considers Listing On Vic Falls Stock Exchange

CALEDONIA Mining Corporation Plc has announced it is commencing the process of pursuing a listing of depositary receipts representing the company’s shares on the Victoria Falls Stock Exchange (VFEX).

Such a listing would be conditional upon market conditions and the implementation of positive proposals made by the Zimbabwe authorities in respect of improved payments in US dollars for gold produced at the company’s majority-owned Blanket Mine.

The VFEX is a subsidiary of the Zimbabwe Stock Exchange and was established in 2020 with the objective of kick-starting the Offshore Financial Services Centre which has been earmarked for the special economic zone established at Victoria Falls.

The VFEX will be for foreign as well as domestic investors in Zimbabwe, and all transactions will be denominated in US dollars.

The proposed VFEX listing demonstrates Caledonia’s continued commitment to Zimbabwe and would allow Caledonia’s and Blanket’s employees in Zimbabwe to participate more easily as Caledonia shareholders.

Securing the VFEX listing is expected to take place during the course of 2021 and would be effected by a placing in Zimbabwe of depositary receipts to raise approximately US$3.0 million (to satisfy the requirements for local shareholder spread) and a subsequent introduction.

The proceeds of the placing would be used for general corporate purposes.

The VFEX listing will be conditional on general market appetite and confirmation that the necessary mechanisms have been implemented so that Caledonia can realise the benefits arising from the VFEX listing including in respect of improved payments in US dollars for gold produced at the company’s majority-owned Blanket Mine.

Caledonia has engaged IH Advisory, a Harare-based financial services group, to advise and assist on this matter.

Commenting on the proposed listing on the VFEX, Steve Curtis, Caledonia CEO said: “I welcome the step towards a more liberal financial environment which is embodied in the proposed benefits attaching to a listing on the Victoria Falls Stock Exchange.”

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Nigeria: Rush for Financial Services Shares Stoke Rise of Nigerian Stocks By N430 Billion

The expectation of banks’ half-year earnings drive the all-share index up 0.22 per cent.

Nigerian stocks were up 0.22 per cent on Wednesday, on course for another week of positive return, as traders and investors continued to shift their gaze to some of the big bank stocks to take strategic positions ahead of the release of companies quarterly and half-year earnings reports due any moment from now.

Access, the country’s biggest bank by asset, drove the rise, supported by rival Zenith and also Custodian Investment.

In the spirit of the earnings season, tier 2 lender Fidelity told the Nigerian Exchange Limited in a Wednesday note of its closed period schedule and the plan of the board to sanction its January-to-June financial report come August 6.

“We expect the positive performance to be sustained as investors take a position in relatively cheap stocks ahead of the earnings season,” said analysts at broker and investment bank Afrinvest.

Market sentiment, a gauge of confidence of investors in the market, closed on a positive note on account that 22 gainers were reported, compared to 14 laggards.

Increasing by 83.27 basis points, the all-share index closed at 38,501.31. Also, market capitalisation finished higher at N20.070 trillion.

So far this year, the index is down by 4.39 per cent.

TOP FIVE GAINERS

Cutix led gainers, growing by 10 per cent to close at N3.63. BOC Gas gained 9.84 per cent to close at N0.67. UACN Property rose by 9.71 per cent to N1.13. Tripple Gee leapt to N0.91, notching up 8.33 per cent in the process. Regal Insurance completed the top 5, climbing up by 9.09% to N0.24.

TOP FIVE LOSERS

BOC Gases led losers, declining by 9.94 per cent to N7.70. Berger shrank by 9.64 per cent to end the day at N8.90. Courteville tumbled to N0.21, losing 4.55 per cent. Japaul Gold dipped to N0.49, recording 3.92 per cent loss. Unity Bank closed at N0.55, going down 3.51 per cent.

TOP FIVE TRADES

In all, 296.099 million shares worth N2.562 billion were traded in 4,507 deals.

FBN Holdings was the most preferred stock, with 34.838 million units of its shares worth N265.090 million traded in 198 deals. Access transacted 28.694 million shares, priced at N271.735 million in 442 deals. Zenith had 27.729 million shares valued at N689.155 million traded in 94 deals. Fidelity traded 24.742 million shares estimated at N57.423 million in 162 transactions. Transcorp traded 23.928 million shares valued at N21.355 million in 91 deals.