Three months after MTN Nigeria debuted on the Nigerian Stock Exchange (NSE), the telecommunications company has leapt pass Dangote Cement to become the most capitalised company on the NSE.
At the close of trading today at the capital market, the network company’s market capitalisation peaked at N2.823 trillion, surpassing the previous day of trading which was N2.699 trillion. MTN Nigeria’s recent market cap overlapped that of Dangote Cement which closed at N2.803 trillion.
It took MTN Nigeria three months to surpass Dangote Cement which had been the company with the highest capitalisation for some years. MTN Nigeria listed on the NSE in May at the rate of N90, but today, the company closed at N132.60 per share at the end of trading.
Recall that MTN Nigeria had agreed to list on the NSE after the Nigerian Communications Commission fined the company N1.04 trillion for the deactivation of more than five million unregistered SIM cards in 2015. The Commission later reduced the fine to N330 billion after much negotiation and diplomatic intervention. The reduction was, however, on the condition that MTN Nigeria would list on the NSE.
On May 31, 2019, MTN Nigeria concluded payment of the N330 billion fine, and also listed on the country’s bourse on May 16 in fulfilment of the agreement.
Why market cap is important: Market cap is the value of a company on the stock market, and this is one of the factors that attract investors. Rather than the calculation of sales or total asset figures to determine a company’s size, the investment community make use of the market cap.
MTN in tax dispute: MTN Nigeria has recruited KPMG as the tax dispute between the telecoms firm and the Federal Inland Revenue Service drags on. The network provider had previously asked a tax tribunal to interpret the decision to pay corporate tax on the N330 billion fine for SIM infraction.