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23 Sep

Daily Financial Market Report for September 23, 2020

Dear Client/Reader,

Bullish trend persists…ASI Increases by 50 Basis Points

The Nigerian Stock Exchange (NSE) closed bullish as the benchmark All Share Index (ASI) increased by 0.50% from 25,654.90 to close at 25,783.02. Market Capitalization increased by N66.9 billion to close at N13.47 trillion while the Year-to-Date (YtD) returns settled at -3.95%.

Sectors performance was significantly bullish

Performance across sectors was significantly bullish as all five sectors closed in the green zone today. The Oil and Gas, Consumer Goods, Insurance, Banking and Industrial indices increased by 2.02%, 1.35%, 1.09%, 0.65% and 0.09% respectively, owing to buy interests recorded in the shares of Seplat (3.90%) and Mobil (0.31%); Nb (3.57%) and Intbrew (9.09%); Prestige (9.09%) and Cornerst (8.33%); Zenith (1.80%) and Fidelitybk (1.69%) amongst others.

NASD Market

The NASD market was flat after today’s trading activities as the Unlisted Securities Index (USI) remained unchanged at 727.03. Consequently, Market Capitalization remained at N534.05 billion. Market activity measured by aggregate volume decreased by -90.93% while value decreased by -90.03%. Investors traded a total of 1,010,717 units of shares valued at N2,279,281.00 in 9 deals. The traded securities today includes; CSCS Plc, Wamco Plc, NDEP Plc and Food CPT.

Please find attached our Daily Financial Market update for today, September 23rd, 2020.

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22 Sep

Daily Financial Market Report for September 22, 2020

Dear Client/Reader,

The Bulls regained position…ASI increases by 31 Basis Points

The Nigerian Stock Exchange (NSE) closed bullish as the benchmark All Share Index (ASI) increased by 0.31% from 25,574.35 to close at 25,654.90. Market Capitalization increased by N42billion to close at N13.40 trillion while the Year-to-Date (YtD) returns settled at -4.42%. 

Sectors performance was significantly bearish

Performance across sectors was significantly bearish as all five sectors closed in the red zone today. The Insurance, Banking, Oil and Gas, Industrial and Consumer Goods indices declined by -1.11%, -0.60%, -0.15%, -0.11% and -0.10% respectively, owing to sell interests recorded in the shares of Cornerst (-6.25%), Linkassure (-5.00%); Ubn (-6.54%), Access (-1.56%); Oando (-1.74%); Uacn (-1.56%) and Intbrew (-2.94%), Honeyflour (-2.17%).

NASD Market

The NASD market closed negative after today’s trading activities as the Unlisted Securities Index (USI) decreased by 0.25% from 728.86 to close at 727.03. Consequently, Market Capitalization decreased to N534.05 billion, as opposed N535.40 yesterday. Market activity measured by aggregate volume increased by 32831.54% while value increased by 10732.85%. Investors traded a total of 11,147,327 units of shares valued at N22,854,597.00 in 11 deals. The traded securities today includes; CSCS Plc, Wamco Plc, NDEP Plc and Nipco Plc, amongst others.

Please find attached our Daily Financial Market update for today, September 22nd, 2020.

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21 Sep

Daily Financial Market Report for September 21, 2020

Dear Client/Reader,

Market Closed Flat…ASI increases by 1 Basis Point

The Nigerian Stock Exchange (NSE) closed flat as the benchmark All Share Index (ASI) increased marginally by 0.01% to close at 25,574.35. Market Capitalization increased by N929 million to close at N13.365 trillion while the Year-to-Date (YtD) returns settled at -4.72%.

Sectors performance was broadly bullish

Performance across sectors was broadly bullish as three sectors closed in the green zone today. The Insurance, Industrial and Consumer Goods indices increased by 1.36%, 0.19% and 0.08% respectively, owing to  buy interests recorded in the shares of Wapic (8.11%), Mbenefit (5.00%) and Cornerst (4.92%); Uacn (4.13%). Conversely, Banking indices declined by 0.30%, on the back of selloffs recorded in the shares of Sterlnbank (-1.68%), Access (-0.78%) and Guaranty (-0.39%). However, Oil and Gas remained unchanged.

NASD Market

The NASD market increased after today’s trading activities as the Unlisted Securities Index (USI) increased by 1.23% from 720.02 to close at 728.86. Consequently, Market Capitalization increased to N535.40 billion, as opposed N528.90 last friday. Market activity measured by aggregate volume decreased by 34.17% while value decreased by 93.68%. Investors traded a total of 33,850 units of shares valued at N210,975.00 in 4 deals. The traded securities today includes; Afriland Plc, CSCS Pls, Wamco Plc.

Please find attached our Daily Financial Market update for today, September 21st , 2020.

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21 Sep

Weekly Market Review & Stock Recommendations – September 21, 2020

Dear Client/Reader,

Global Economic Roundup

OPEC+ urges full conformity with production cuts.

·         Crude oil was under pressure on Friday and in a position to close lower for a second consecutive week on growing demand worries and an unexpected rise in U.S. stockpiles that raised new concerns about oversupply.

Fed holds rates steady near zero; indicates it will stay there for years.

•       Fed said short-term rates would remain targeted at 0%-0.25%. They equally changed their economic forecasts to reflect a smaller decline in GDP and a lower unemployment rate in 2020. They now see a full-year GDP decline of 3.7%, considerably better than the 6.5% drop forecast in June.

Domestic Economic Roundup

Nigeria’s inflation rate hits 13.22% in August 2020, highest in 29 months.

•       Nigeria’s inflation rate rose to 13.22% in August 2020, highest recorded in 29 months, since March 2018 (13.24%). This was due to an increase in prices of Passenger transport by air, Hospital services, bread and cereals, potatoes amongst others.

CBN to increase loans to agricultural sector to 10% of total bank credit.

•       The CBN said the country needs to increase its bank credit to the agricultural sector by over 50% within the next 4 years to boost food production. This is expected to drive the allocation to the sector to 10% of the entire credit in the banking sector from the current 4%.

Equities Market

The Nigerian Stock Exchange closed bearish last week as the ASI declined by 0.08% week-on-week to close at 25,572.57 points.

The current low prices of stocks still provide good buying opportunities in the market. Some of our recommended stocks are mentioned below;

DANGSUGAR – Dangote Sugar Plc. HY’2020 results showed that revenue grew by 28.46% from N80.36 bn in HY’2019 to N103.23 bn in HY’2020. However, gross profit went down by 1.38% to N20.82 bn in HY’2020 from N21.12 bn in HY’2019. The decline in gross profit was driven by a 39.09% hike in cost of sales. Profit from operations advanced by 0.68% from N17.28 bn in HY’2019 to N17.40 bn in HY’2020, due to a 434.33% increase in other income and a 15.93% decline in selling and distribution expenses. Profit before tax inched up marginally by 0.07% to N17.05 bn in HY’2020 from N17.03 bn in HY’2019. Profit after tax grew by 5.51% from N10.98 bn in HY’2019 to N11.58 bn in HY’2020, on the back of a 9.79% decline in income tax expenses. Consequently, earnings per share rose by 5.43%, from N0.92 in HY’2019 to N0.97 in HY’2020. Dangote Sugar has a BVPS of N9.98, P/BV of 1.20x and P/E ratio of 6.19x.

Dangote Sugar has managed to shield itself from the slowdown witnessed in the consumer goods industry, owing to the increased sale of sugar and related products before and even during the lockdown. We saw their revenue from the retail and industrial sale of sugar increase by 30 percent and 69 percent, respectively in the first half of the year, hence supporting a bottom-line growth. While the manufacturing industry in general is projected to contract by 5.10% in 2020, following the 8.78% contraction in Q2, it has been observed that the demand for sugar has remained high, hence, allowing Dangote Sugar to grow their revenue by maneuvering around the distribution limitations during the lockdown. Hence, we expect their 2020 PAT to move past N23.00 billion, taking the EPS above N2.00.     

UCAP – United Capital’s result for HY’2020 showed that gross earnings increased by 37.26% from N3.24 bn in HY’2019 to N4.45 bn in HY’2020. Net operating income rose by 45.40% from N2.82 bn in HY’2019 to N4.10 bn in HY’2020, due to a 347.65%, 85.03% and 77.15% increase in net interest margin, net trading income and fees and commission income, respectively. Profit before tax rose by 14.10% from N1.99 bn in HY’2019 to N2.27 bn in the current period, despite the surge in key expenditure line items, such as the personnel expenses which rose by 7.86%, and the other operating expense which increased by 87.73%.  Profit after tax increased by 15.98% to N1.91 bn in the current period from N1.65 bn in HY’2019. Consequently, Earnings per share went up by 14.29% from N0.28 in HY’2019 to N0.32 in the current period. UCAP has a BVPS of N3.02, P/BV of 1.04x and P/E ratio of 4.92x

The financial services sector grew by 28.41% in Q2, and is projected to grow by 20.50 percent this year, supported by the performance of highly digitized firms such as United Capital. The company has been able to digitize their products, with various online and mobile platforms for service delivery. This in turn serves them, as the Covid induced restrictions on movement has minimally disrupted some aspects of their business. Hence, we should see the PAT climb above N5.4 billion, while the EPS is projected above N0.90. Please find attached our Weekly Market Review & Stock Recommendations for this week.

Thank you.

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18 Sep

Daily Financial Market Report for September 18, 2020

Dear Client/Reader,

Bulls took Over…ASI increases by 15 Basis Points

The Nigerian Stock Exchange (NSE) closed positive as the bulls dominated proceedings in the market today. The benchmark All Share Index (ASI) surged by 0.15% to close at 25,572.57. Market Capitalization increased by N20.49 billion to close at N13.36 trillion while the Year-to-Date (YtD) returns settled at -4.73%.

Sectors performance broadly bullish

Performance across sectors was broadly bullish as two sectors closed in the green zone. Consumer Goods and Banking indices increased by 0.59% and 0.30% respectively, on the back of buy interests recorded in the shares of Dangsugar (7.14%); Access (1.57%) and Unitybnk (5.56%). Conversely, Insurance indices declined by 0.30%, on the back of selloffs recorded in the shares of Cornerst (-1.67%). However, Oil and Gas as well as Industrial remained unchanged.

NASD Market

The NASD market was unchanged after today’s trading activities as the Unlisted Securities Index (USI) closed at 720.02. Consequently, Market Capitalization also remained the same at N528.9 billion. Market activity measured by aggregate volume decreased by 96.14% while value decreased by 84.16%. Investors traded a total of 51,418 units of shares valued at N3.34 million in 1 deal. Only one security traded on the NASD platform today; Nipco Plc.

Please find attached our Daily Financial Market update for today, September 18, 2020.

Thank you.

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