9 Companies Control N42.9trn Of Total NGX Market Cap

Dangote Cement Plc and eight other companies out of 155 listed on the Nigerian Exchange Limited (NGX), contributed about 77.67 per cent or N42.995 trillion of the

N57.158 trillion overall Nigerian Exchange (NGX) equity capitalisation as at the close of trading on Friday.

The other companies are: Airtel Africa, BUA Cement, MTN Nigeria Communication (MTNN), BUA Foods, Seplat Energy, Geregu Power, Zenith Bank and Guaranty Trust Holdings Company (GTCO).

In the first month of the year, the NGX sustained the 2023 bullish momentum with a month-on-month gain of 35.3 per cent as investors showed enthusiasm ahead of earnings season.

The stock market has witnessed an unprecedented rally and buying interest, especially in the financial services, consumer, and industrial goods sub-sector, which has continued to trigger massive bargain hunting in large company shares.

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This has pushed the key performance indices and stimulated activities in the market, a development that has led to the rating of the stock market as the best-performing in the world.

Dangote Cement’s stock price in January appreciated by N443.10 per share or 138.5 per cent to close January 31, 2024 at N763 per share from N319.90 per share it opened for trading this year.

The cement maker’s market capitalisation gained N7.55 trillion in one month to close at N13 trillion as of January 31, 2024. The positive momentum of Dangote Cement stock price commenced when it was announced to the capital market community that Nigeria’s billionaire investor, Mr. Femi Otedola has acquired some stake in the cement company.

Otedola, in a statement said, the recent acquisition of shares in Dangote Cement, a strategic investment, underscores his confidence in Dangote Cement’s potential to generate foreign exchange for the country and his dedication to supporting businesses that contribute to Nigeria’s economic resilience.

Otedola’s investment aligns with his vision of long-term wealth preservation and the belief that shareholders should be the primary beneficiaries of a company’s success.

“Dangote Cement’s unique position with two export terminals offers a substantial opportunity to earn foreign exchange, crucial for Nigeria’s economy.

This, along with the company’s pan-African presence, makes it an ideal investment choice,” Otedola said.

Airtel Africa came second with a market capitalisation of N7.516 trillion, while BUA Cement closed the month of January with capitalisation of N6.265 trillion,

Others are MTNN, BUA Foods, Seplat Energy, Geregu Power, Zenith Bank and GTCO with a market capitalization of N5.900 trillion, N4.892 trillion, N1.809 trillion, N1.420 trillion, N1.102 and N1.089 trillion in January.

Responding to market performance in January, the vice president, Highcap Securities Limited, Mr. David Adnori stated that investors are trading based on sentiment.

He stated that the emergence of President Bola Tinubu further energised the stock market since market participants have hope in his ability to rejig the economy and implement economy-friendly policies.

Speaking on few stocks dominating the market, the Professor of Capital Market, Nasarawa State University, Keffi, Prof. Uche Uwaleke, at his keynote address at the 2023 Capital Market Correspondents Association of Nigeria (CAMCAN) in Lagos said, the Nigerian capital market is over-concentrated with the attendant ‘key man’ risks, part of what are major barriers to market development.

He said, this is demonstrated by the fact that only seven out of 155 listed companies account for over 60 per cent of equities market capitalization, saying that the 155 issuers base is relatively small.

“Many eligible companies including multinational companies particularly in the telecom and oil and gas sectors remain unlisted. Out of the over four million companies registered by the Corporate Affairs Commission as at 2020, only 155 companies on NGX, and less than 50 on NASD and nine on the NGX Growth Board,” he said.

He, however, recommended that privatised government enterprises are to be listed on the NGX for the capital market to develop and support the nation’s development.