Shares of manufacturers quoted on the Nigerian bourse have been consistently beaten down since 2015, a situation compounded by foreign exchange restrictions imposed by the Central Bank of Nigeria (CBN).
Flourmills, the largest miller in Africa’s largest economy last saw stock price rise to the highest in 2015 when it touched N31 but today it is trading at N17.51.
Honeywell’s share price was N2.65 in 2015 as against N1.58 as of today.
Nigeria Breweries Plc, the largest brewer by market value closed at N138 in early last year this compares with N97 as at March 2016.
Guinness closed at N147 in 2015 compared with N114 recorded this year.
Unilever last year as it hit a high of N41 compared with N28 as at March 2016.
Cadbury rose the most in 2015 as its stock price closed at N90, compared with N17.20 in 2016.
Vono products, the company that manufactures foams and bedding had its stock price rise to the highest in 2015 when it touched at N1.61, as against N0.90 in 2016.
Vitafoam, another foam maker closed the highest at N7 in 2015 from N4 this year.
The woes of these firms have been compounded by Buharinomics, an economic ideology of President Muhammadu Buhari, who has backed the apex bank’s decision to ban 41 items from accessing dollar at the official market.
Consequently, manufacturers are unable to settle foreign suppliers and the policy has also hindered them from importing raw materials for the purpose of production.
This has caused stock-out as inventory level cannot be replenished on the back of dollar scarcity.
“Access to dollar is our major problem,” said George Nassar, Managing Director of Procter & Gamble, a fast moving consumer goods firm.
“We are working with suppliers outside to come and localise in Nigeria,” said Nasser.
The central bank has left the currency pegged at N197-N199 as it seeks to stabilize an economy and protect a reserve that is hard hit by a slump in oil price.
Oil accounts for two thirds of government revenue and 90 percent of foreign exchange earnings.
However, Buharinomics far from solving Nigeria’s economic stagnation rather is adding to it as recent data from the National Bureau of Statistics (NBS) showed Gross Domestic product (GDP) fell to 2.1 percent, from 2.8 percent in the third quarter of 2015, the sharpest fall in a decade.
The industrial sector contracted 2.2 percent, extending its recession. Manufacturing has not risen above 10 percent of GDP since independence.
“Growth is going to slow in the next few years,” said Philip Walker, Regional Manager, of the Economist Intelligence Unit.