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Markets

Guinness Nigeria falls to 5 year low

@guinnessngr has stayed at a 5 year low of N54 for the second trading session this week, on the Nigerian Stock Exchange.

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Guinness Nigeria

Guinness Nigeria Plc today ended today’s trading session at a five year low for the second day in a row. The stock closed at N54 and traded a total of 314,384 units.  

Year to date, the stock is down 25% underperforming the Nigerian Stock Exchange All-Share Index which is down 4.87% 

The sector has lagged  

The stock is not the only one with a disappointing year to date performance. Nigerian Breweries is down 25.1%. International Breweries is down 31.1%. Fringe operator Champion Breweries has also done poorly, declining by 33.7% year to date.  

A combination of consumer preference for value beers, a spike in excise duties, and a middling macroeconomic environment have left brewers struggling.

Intense competition between the big three (Nigerian Breweries, International Breweries, and Guinness Nigeria) have left them unable to pass the costs to their customers.

Nigerian Breweries profit after tax for the first quarter ended March 2019 shows a 21.5% decline in profit after tax.

How low will it go? 

Possibilities of the stock dipping further are fairly high. In yesterday’s trading session, the stock dipped below the N50 mark but closed at N54 because it did not move the required volume to effect a price change.  

Quarterly results for the first three calendar months of the year typically tend to be poor for brewers.

Q1 2019 results released by its peer Nigerian Breweries show a slight increase in revenue but drop in the bottom line. Guinness Nigeria results are unlikely to show any significant upside, especially in terms of the bottom line.

HY 2018/2019 results were up largely due to a decline in finance costs and marketing expenses. 

About the Guinness Nigeria  

Guinness Nigeria was incorporated in Nigeria on April 29th, 1950 as a trading company importing Guinness Stout from Dublin, Ireland. 

The company manufactures a  wide range of alcoholic and non-alcoholic beverages from breweries in Ikeja (Lagos State) and Benin City (Edo State). Guinness Nigeria Plc was listed on the Nigerian Stock Exchange on January 2nd, 1965. 

 

Jaiz bank

Onome Ohwovoriole has a degree in Economics and Statistics from the University of Benin and prior to joining Nairametrics in December 2016 as Lead Analyst had stints in Publishing, Automobile Services, Entertainment and Leadership Training.He covers companies in the Nigerian corporate space, especially those listed on the Nigerian Stock Exchange (NSE).He also has a keen interest in new frontiers like Cryptocurrencies and Fintech. In his spare time, he loves to read books on finance, fiction as well as keep up with happenings in the world of international diplomacy.You can contact him via [email protected]

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Markets

Union Bank, LINKASSURE push NGX ASI into recovery

The market breadth closed positive with the bulls as LINKASSURE led 25 Gainers, and 16 Losers topped by NEM.

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Nigerian stock exchange market made a bullish recovery on the last day of the week’s trading session. This surge was bolstered by gains made by UBN and LINKASSURE amongst others. The All-Share Index increased by +0.21% to close at 39,198.75 from 39,114.73.

  • Nigerian Stock Exchange market value currently stands at N20.48 trillion. Its Year-to-Date (YTD) returns currently stand at -2.66%.
  • The market breadth closed positive with the bulls as LINKASSURE led 25 Gainers, and 16 Losers topped by NEM, showing a hint of consolation.

Top gainers

  1. LINKASSURE up +9.25% to close at N0.69
  2. JOHNHOLT up +9.26% to close at N59
  3. UBN up +9.09% to close at N5.40
  4. ROYALEX up +8.33% to close at N0.65
  5. CHIPLC up +8.33% to close at N0.39

Top losers

  1. NEM down -9.50% to close at N1.81
  2. COURTVILLE down -9.09% to close at N0.20
  3. SUNUASSUR down -8.47% to close at N0.54
  4. INITSPLC down -6.98% to close at N0.40
  5. ETERNA down -6.89% to close at N5.81

Outlook

The market recovered from a week-long loss as it posts profit at the end of the trading session.

  • Market sentiments tend toward bullish momentum as the NGX ASI closes with 25 Gainers and 16 losers.
  • Nairametrics however, advises cautious buying in this era of growing uncertainties.

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Markets

SEC plans to monitor foreign stock brokers in Nigeria

SEC is proposing tighter and stricter regulatory oversight and requirements for foreign stockbrokers in the country.

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Nigerian Stocks snap 7-year losing streak to post first gain in August

In an attempt to reduce the demand for foreign stocks in Nigeria, the Securities and Exchange Commission (SEC) is proposing tighter and stricter regulatory oversight and requirements for foreign stockbrokers in the country.

In an interview monitored by Nairametrics, the executive commissioner for operations of the SEC, Dayo Obisan revealed the commission was planning to actively monitor the local facilitators of foreign stocks.

“At least 400,000 Nigerians have invested in foreign stocks through brokers in the past 18 months,” Obisan said, with Nigerians actively trading or holding foreign equities now exceeding those investing in the local market and about 70% of these participants being less than 40 years of age.

This is despite the Nigerian Stock Exchange being dubbed the best performing last year after it gained 50% YTD. Stocks are however down 5% YTD.

In contrast, the S&P 500 Index is currently trading 14.50% YTD, creating a new all-time high.

Also, the value of transactions is down YTD as demand shifts from the Nigerian stock exchange market to the Cryptocurrency and foreign stock market.

“There is an increasing interest among the younger population and this is of concern to the commission primarily because it creates an avenue for exploitation,” Obisan said.

The SEC intends to license firms offering foreign stocks under a “digital sub-broker” regulation, which Obisan says should provide a form of clarity to their activities.

He also stated the requirement will ensure “regulatory responsibilities in on-boarding clients, custody of assets, and compliance with reporting requirements are met”.

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