7 Companies Account for 70% of NGX Market Capitalisation
As of Friday’s close, only seven listed companies accounted for 70% of the stock market capitalisation amidst criticism that Nigeria’s capital market lacks depth. MarketForces Africa review shows that the Nigerian Exchange (NGX) has now registered seven market movers after Tier-1 banks made an entry into the trillion naira valuation class.
These seven tickers which include MTNN, DANGCEM, AIRTELAFR, BUACEMENT, BUAFOODS, ZENITH, and GTCO worth N23 trillion. Trading data showed that the equities market surged to N33 trillion on Friday, driven by gains recorded in telecom, banking, and industries stock while the consumer goods sector miss in the show.
MarketForces Africa review shows that the telecommunication companies’ combined market valuation printed at N10 trillion while top five banks’ valuation shifted to N3.711 trillion, and two major cement names were priced at about N8 trillion.
Of the Tier-1 bank’s N3.711 trillion market value, Zenith and GTCO Plc accounted for N2.105 trillion, while the largest lender by total assets was valued at about N575 billion, FBNH N612 billion, and UBA was priced at about N419 billion.
In the bourse, BUA Foods has raced ahead of Nestle Nigeria Plc, one of the falling angels in the market. Nestle Nigeria lost its market position as investors’ sentiment shifted away from the consumer goods index amidst challenges in the economy.
In a market note, analysts at CardinalStone Research said they still expect foreign investors buying to materially reprice the prices of some of the bellwethers, especially the banks following a decision to float rate.
Data from the Nigerian bourse showed that MTN Nigeria Plc leads the pack (N5.565trn), followed by Dangote Cement (N4.845trn), and the falling angel, Airtel Africa came third on the rank (N4.960).
BUA Cement followed these bellwethers (N3.124trn) followed by Bua Foods (N2.444trn) before the two new entrants into the space. Zenith Bank made entry into the category ahead of GTCO with a market capitalisation that settled at N1.075 trillion and N1.03 trillion respectively.
Nigerian exchange has hundreds of less attractive listed stocks. Despite the recent rally, stockbrokers have maintained a view that stocks still have large upside potential. #7 Companies Account for 70% of NGX Market Capitalisation