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Stock Market

Champion Breweries shares slump by 33%, reducing YTD gains to 190%

Shares of Champion Breweries nosedive, as wary investors exit their positions in the local brewer.

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This brewer keeps struggling to win as Nigeria’s beer war rages on 

Champion Breweries shares nosedived by as much as 33.5% in four trading sessions on NSE, at the back of profit-taking activities and sell-off of the shares of the company, as wary investors exit their positions in the local brewer.

Checks on the website of the Nigerian Stock Exchange at the close of trading activities today, the 8th of February 2020, revealed that Champion Breweries shares have slumped by 33.51% to N2.50, when compared with N3.76 recorded at the close of trade on the 2nd of February 2021.

As of the close of trading activities on the Nigerian Stock Exchange on the 2nd of February, it is essential to understand that Champion Breweries year to date gain stood at 337.21%

However, with the recent streak of declines in Champion breweries’ share price, the brewer remains the best performing stock on NSE, with a year-till- date gains of 190.70%

What you should know

  • The rally in the shares of Champion Breweries, however, before the recent decline was largely driven by Heineken’s acquisition of additional 1,903,609,538 ordinary shares of Champion Breweries, at a price of N2.6 per share through its wholly-owned subsidiary, Raysun Nigeria Limited.
  • The acquisition of the brewer’s shares by Raysun Nigeria Limited at a total purchase consideration of N4.959 billion representing 24.3% stake in Champion Breweries, increased the ownership stakes of Heineken’s SPV in the local brewer to 84.7%.
  • This change, occasioned by the acquisition puts Heineken in a position to launch a takeover bid, through its Special Purpose Vehicle (SPV), Raysun Nigeria Ltd.
  • With the acquisition done at N2.6 per share on 7th January 2021, while the shares of the company were trading at N0.93 per share, investors on the Nigerian Stock Exchange were convinced Champion Breweries shares were undervalued.
  • This ruling sentiment on the local bourse led to a scamper for the shares of the company. This also led to the sporadic increase in the share price and the market capitalization of Champion Breweries.

Omokolade Ajayi is a graduate of Economics, and a certificate holder of the CFA Institute’s Investment Foundation Program. He is a business analyst, and equity market researcher, with wealth of experience as a retail investor. He is a business owner and a stern advocate of Financial literacy, who believes in the huge economic prospect of the Nigerian Payment channels and Fintech space.

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Business

SEC denies knowledge of Oando shareholder’s court case

SEC has denied ever being served with court processes with respect to the purported matter at the FCT High court.

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unclaimed dividend, SEC restrains fintech company, Chaka from advertising or offering for sale shares

The Securities and Exchange Commission (SEC) has denied the claim by one of Oando Plc’s shareholders, Engr Patrick Ajudua, that he won a court case against the capital market apex regulator.

SEC disclosed in a statement it issued and seen by Nairametrics on Wednesday that there was never a time it was served with court processes with respect to the purported matter at the FCT High court.

It stated, “The attention of the Securities and Exchange Commission (the Commission) has been drawn to several publications in the media, where it is reported that a shareholder of OandoPlc, purportedly obtained a judgment from the Federal Capital Territory High Court against the Commission.

“The Commission wishes to inform the general public that it was never at any time served with court processes with respect to the purported matter at the FCT High court. The Commission will consequently take all necessary steps to verify and set aside the purported decision of the said Court.”

What you should know

  • On Tuesday, Ajudua, reportedly won a legal suit, which was filed at the High Court of the FCT against SEC, according to Nairametrics.
  • He filed that the directive of the SEC suspending Oando’s Annual General Meeting is in breach of his right to freedom of association as guaranteed under Section 40 of the Nigerian Constitution and Articles 9, 10 & 11 of the African Charter on Human and Peoples Rights.
  • In the said hearing presided over by Honorable Justice O. A Musa, all cases filed were granted in his favor.

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Spotlight Stories

Bulls stage a comeback at Nigerian stock market

Nigerian bourse ended the third trading session of the week amid falling oil prices across the market spectrum.

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The Nigerian stock market ended the third trading session of the week on a bullish note. The All Share Index rallied by 0.14% to close at 40,221 index points.

Year-to-date return and market capitalization settled at -0.12% and N21.04 trillion respectively.

  • Activity level strengthened as total volume and value of stocks traded grew 38.95% and 82.28% to 469.56 million units and N7.08 billion respectively.
  • The top traded stock by volume and value was ZENITHBANK (1.15%) at 154.6 million units valued at N4.09 billion.
  • The NSE Oil & Gas index topped the gainers, up 0.79% on the back of sustained buy interest in OANDO.
  • Investor sentiments as measured by market breadth was neutral as 20 stocks advanced against 20 decliners. OANDO (+10.00%) led the gainer’s chart today, while LASACO (-9.49%) was the top loser.

Top gainers

  1. OANDO up 10.00% to close at N3.41
  2. ABCTRANS up 9.38% to close at N0.35
  3. JAPAULGOLD up 9.23% to close at N0.71
  4. ROYALEX up 8.70% to close at N0.25
  5. ACADEMY up 7.89% to close at N0.41

Top losers

  1. LASACO down 9.49% to close at N1.24
  2. CHIPLC down 8.33% to close at N0.33
  3. CORNERST down 7.81% to close at N0.59
  4. FLOURMILL down 6.94% to close at N28.85
  5. WAPIC down 6.90% to close at N0.54

Outlook

Nigerian bourse ended the third trading session of the week amid falling oil prices across the market spectrum. High buying pressures from medium capitalized stocks which include OANDO, JAPAULGOLD, ROYALEX lifted market sentiments across the spectrum.

  • Trailing, the Banking and Industrial indexes gained 0.77% and 0.22% respectively due to price appreciation in ACCESS (+1.80%), FIDELITY (+1.73%), and ZENITH (+1.13%).
  • Nairametrics, however, suggests cautious buying amid soft crude oil demand in play at the world’s largest economy.

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