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Dangote Cement, MTN hit N3 trillion market cap, as GT Bank crosses N1 trillion

Great performance for Dangote Cement and MTN Nigeria as they each hit the N3 trillion market capitalisation mark.

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Dangote Cement and MTN Nigeria have both crossed the N3 trillion market capitalisation mark, while GT bank also hit N1 trillion during the week, as their Investors gained N1.93 trillion from January to date.

As at the close of trading session on Tuesday, 10th November 2020, MTN Nigeria was worth N3.18 trillion to be the most capitalised firm on the Stock Exchange, Dangote Cement closed with a valuation of N3.15 trillion while GT Bank with N1.03 trillion, all three boasting an aggregate value of N7.36 trillion, which represents 43.2% of the total equity value of the Stock Exchange.

Highlights

  • Dangote Cement grew its market capitalisation by 30.28% year-to-date, from N2.42 trillion recorded as at the end of trading on the 31st December 2019 to N3.15 trillion as of 10th November 2020.
  • MTN recorded a year-to-date growth of 48.76% from N2.14 trillion as of December 2019 to a current valuation of N3.18 trillion, hitting a record high at N156.2 per unit of share.
  • The most capitalised financial institution on the Stock Exchange, GT Bank saw its market capitalisation grow by 17.85% year-to-date, with a cost per share of N35.
  • The Stock Exchange Equity cap is currently valued at N17.06 trillion.
  • Investors in Dangote Cement, MTN and GT Bank gained a sum of over N1.9 trillion, from January to date.

What is their financials saying?

MTN

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A cursory look at the financial performance of MTN in the 9-month period between January and September 2020 showed that the Telco giant boosted its revenue by 13.9% as it generated a sum of N975.8 billion and posted an operating profit of N307 billion.

However, it recorded a 3.3% drop in profit after tax from N149.2 billion in the comparable period of 2019 to N144.2 billion while its earnings per share also dropped by the same margin to close at N7.09 as at the end of September.

According to the report, the 7.8% growth in operating profit was largely impacted by the increase in finance costs as a result of increased borrowings (September 2019: N381 billion, September 2020: N509 billion) leading to 0.6% decline in profit before tax to N211.6 billion.

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Dangote Cement

Dangote Cement grew its revenue by 12.2% from N678.8 billion recorded in the corresponding period of 2019 to N761.4 billion as of September 2020. It also recorded a marginal increase in gross profit margin from 57.4% as of September 2019 to a current margin of 58.3%.

The Industrial giant, posted a profit after tax of N208.7 billion in the review period, representing a 35.2% increase when compared to N154.4 billion recorded in 2019 while earnings per share grew by 34.6% to N12.25.

Nairametrics earlier reported that the Nigerian government has given Dangote Cement the approval to export Cement to West African countries through the Nigerian land borders, which has been closed for over a year, an avenue to increase revenue, reduce cost of transportation, hence profitability.

GT Bank

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The banking giant, which just received approval from the Central Bank to operate as a financial holding company boasted of 1.5% revenue growth as of June 2020 despite the COVID-19 induced lockdown in the country for most parts of the second quarter.

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GT Bank however, recorded a 4.9% decline in profit of N94.3 billion as against N99.1 billion in 2019 half-year. This reflected in the earnings per share as it declined by 5.1% to stand at N3.31. It should be noted that as at the time of writing this article, GT Bank is yet to release its Q3 financial report.

Below is the table of the top 10 most capitalised companies on the Stock Exchange and their sectors, as of November 10th 2020;

Bottom line

As these Stock keeps appreciating in value, it shows a sign of the confidence Investors have in them as buying pressure was seen across major listed stocks. This is likely to continue in the short-term as many Investors will look to take their share of the market gain before the end of the year.

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Stock Market

Mutual Benefits Assurance Plc to raise N4.8 billion through private placement

Mutual Benefits Assurance Plc. has secured permission to raise the sum of N4.8 billion through private placement.

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Mutual Benefits Assurance announces CEO's exit, replacement

The Board of Directors of Mutual Benefits Assurance Plc. has secured permission to raise the sum of N4.8 billion through private placement.

This is according to a disclosure signed by the company’s Secretary, Jide Ibitayo and seen by Nairametrics.

The disclosure is part of the resolutions reached at the Extra-Ordinary General Meeting of the firm and sent to the Nigerian Stock Exchange, dated December 3, 2020.

According to the information contained in the notification, the private placement worth N4.8 billion is to be raised through the sale of 8,888,888,889 ordinary shares of 50 kobo each of the company, at the rate of 54 kobo per share, in a distribution succinctly captured below:

  • 5,331,004,445 units (approximately 60% of the total allotted units) is to be sold to Charles Enterprises LLC for about N2.88 billion.
  • The remaining 3,557,844,444 (approximately 40% of the total allotted units) is to be sold to Arubiewe Farms Ltd for about N1.92 billion.

What this means

  • According to Investopedia, a private placement is a sale of stock shares or bonds to pre-selected investors and institutions rather than on the open market. It is an alternative to an initial public offering (IPO) for a company seeking to raise capital for expansion.
  • In this light, it is pertinent to note that private sales are now common for start-ups, as they allow the company to obtain the money they need to grow while delaying or foregoing an IPO.

What you should know

Other key resolutions reached at the Extra-Ordinary General Meeting include:

GTBank 728 x 90
  • Raising the company’s authorized share capital from N10 billion to N10.05 billion.
  • To raise additional capital via the issue of debt or equity or a combination of both including convertible bonds, loans, stock, bonds with options etc.
  • Amendment of clause 6 of the Memorandum and clause 5 of the Articles of Association of the company respectively.

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Stock Market

UBA, GTBank, Zenith Bank tumble, Bears take a grip on Nigerian Stocks

The market breadth index was negative with 25 losers against 13 gainers.

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Nigerian bourse closed negative on Thursday. The All Share index declined further by -0.25% to close at 34,968.94 from 35,056.82 points.

  • Year-to-date and market capitalization similarly dropped by -0.25% to settle at 30.40% and N18.27 trillion respectively.
  • A total volume of 289.3 million units of shares, valued at N7.34billion exchanged hands in 4,878 deals. UBA was the most traded shares by volume at 34.4 million units, while MTNN topped by value at N4.37billion.
  • The market breadth index was negative with 25 losers against 13 gainers. CADBURY (-5.43%) led the laggards today, while ARDOVA (+7.69%) was the top gainer.
  • The sectorial performance was mixed as the Banking, Insurance, and Consumer Goods indexes dipped -2.07%, -0.82%, and -0.20%, while the Oil & Gas gained +0.35%. The Industrial sector closed flat.

Top Gainers

  1. MTNN up 0.77% to close at N156.2
  2. ARDOVA up 7.69% to close at N14
  3. REDSTAREX up 4.00% to close at N3.38
  4. CUTIX up 5.56% to close at N1.9
  5. UPL up 4.26% to close at N1.47

Top Losers

  1. CADBURY down 5.43% to close at N8.7
  2. UBA down 5.20% to close at N8.2
  3. ZENITHBANK down 1.88% to close at N23.55
  4. FLOURMILL down 1.85% to close at N26.5
  5. GUARANTY down 1.47% to close at N33.6

Outlook

Nigerian stocks drifted lower at the fourth trading session of the week, as significant sell-offs seen in Nigerian tier -1 banks added pressure on the Nigerian All-Share Index.

  • Stock experts anticipate more consolidation moves as investors become more choosy on stocks to buy taking into consideration that experts don’t see any new highs now till next year.
  • That said, Nairametrics envisages cautious buying on the bias that stock traders are expected to be a bit wary amid recent macros prevailing at the Nigerian currency market.

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Stock Market

Camey & Rock executes N4.3 billion worth of share purchase agreement with Resort Savings and Loans

Camey & Rock Business Consulting executes a share purchase agreement with Resort Savings and Loans Plc, worth N4.3 billion.

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Rock savings raises N4.3 billion, as Camey and Rock acquire majority shares  

Camey & Rock Business Consulting Limited has finally executed its share purchase agreement with the board of Resort Savings and Loans Plc, worth N4.3 billion.

This is according to a notification sent by the latter to the Nigerian Stock Exchange market yesterday and seen by Nairametrics.

The cash involved in the deal is scheduled to be injected in tranches. Also, activities related to the transactions are still ongoing.

In order to resolve some administrative and basic regulatory issues, Camey & Rock called for an extension from CBN to enable it conclude the recapitalization exercise of the bank outside the deadline of 31 December 2020 to 30 June 2021.

The call comes at a time when the investors plan to inject the next tranche of cash into the bank.

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The notification also revealed that the investors (Camey & Rock) have so far, assisted in motivating staff resolution and arrangement of some critical financial obligations, towards the filing of outstanding financial statements and relocation of the bank’s head office to 12, Boyle Street, Lagos.

What they are saying: A part of the recent disclosure reads: “The Board of Resort Savings and Loans Plc (the bank) wishes to notify the Nigerian Stock Exchange and investing public on the updates on the Bank’s recapitalization exercise.

“The Bank has executed a Share Purchase Agreement with Camey & Rock Business Consulting Limited (Camey & Rock or the investor) to the tune of N4.3billion, following Camey & Rock’s strategic equity investment in the Bank. The cash will be injected into the Bank in tranches.”

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Why it matters: The recent announcement will help recapitalize the bank. In addition, the board and management firmly believe that the strategic investment will change the face of the bank, repositioning it in the committee of financial services providers in Nigeria, and grow its capacity with consequent effect in increasing the wealth of stakeholders.

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