The Nigerian Exchange Group Plc said that part of its targets for the 2023 financial year is to collaborate with the Securities and Exchange Commission (SEC) to ensure that companies in the free zone area can assess the local bourse.
Temi Popoola, the CEO of Nigerian Exchange Limited (NGX), stated this at the 2022 NGX Group FY Investor and Analyst Conference Call.
More listings on the NGX: Popoola noted that the Exchange is working extensively with the apex regulator to make sure that companies in the free zones can assess the capital market and raise capital from there.
- “We’re expecting at least one listing this year from this sector. And then the other thing around this is about technology, with the approval of those technology board rooms, we expect that we can drive more listings going forward from there,“ he said.
Change of government: He stated that one of the things that give the Exchange strong momentum this year is a change in government and administration in Nigeria. He said:
- “We made the argument several times that listings have a very strong correlation with government policy, has a very strong correlation with government’s intentionality.
- “When we look at all of the listings that we have on the exchange today, the data shows that 90% of them will not be on the exchange but for some sort of government support.
- “So we’re using this opportunity of a change in government to work with our stakeholders, many of our key stakeholders to go back and make this case around listings. And we see that the real need for advocacy will really drive them, particularly when the nation itself also would need to rely on the capital markets to drive revenues to improve liquidity. We do think that a lot of that activity if done properly, should translate into listings.
- “For example, now with a change in government, will go back to argue around things like deepening the institutional local money into the capital markets.
- “How can we facilitate more return of foreign capital back to our markets to help us with deepening and improving trading?
- “We’re looking to do a lot more work with retail also this year, back to our technology strategy, and technology approach, work with our intermediaries to find ways to help retail trading continue, whether through margin, for example, or through the use of technology.”
New Products: Poopola noted that the Exchange is also planning to roll out new products that will appeal to the younger set of investors in 2023.
- “One of the things that we have heard from a lot of younger sets of investors is that they would like products that are able to offer them currency sort of protection. They would like products that are different from just our core financial product offerings.
- “So we are looking to launch things like more depository receipts this year, we are working with our regulator and a few other things on digital assets.
- “We will continue our technology digitization efforts. We’re hoping to come to the market this year with the USSD solution for the capital markets. We have seen this work quite well in the broader financial services sector, particularly with the banks,“ he said.
Another rhethorics for 2024 id brewing
The truth is we have a dysfunctional stock market as further exemplified by
2022 report card that looks like the following:
1. Operating expenses > than revenue
2. Without CSCS, NGX is a loss maker
3. Directors ( just 3 or so) consuming almost 10% of gross revenue
4. Battling with governance issues
5. No single IPO in 2022
6. 70% of capitalization due to a few SWOOTs
7. Negative working capital
8 listed companies now seek short term succour in commercial paper issuances
9 The only new word in their account is the substitution of associated company with investee companies in their accounts 😂😂
Demutualization was ill advised indeed