Nigeria | NGX

Guinness Nigeria Plc’s (GUINNESS) Q1 2024 numbers showed resilience across key performance metrics. The renowned foreign extra stout brewer recorded double-digit Revenue growth of 12.7% y/y to N59.54bn (Q1 2024) amidst the nation’s high inflation which has weakened consumer purchasing power. Sales volumes remained pressured in the face of stiff competition, and as consumers persist in adapting their spending preferences towards essentials. However, we believe the company’s performance will improve in the next quarter (Q2) as holiday season demand drives sales. 

BUA Cement’s +27.92% y/y Revenue growth in 9M 2023 was primarily driven by an increase in price and sales volumes. BUA Cement reported increases in prices in 9M 2023 with average cement price rising by 21.4% to N68,540/ton from N56,468/ton in 9M 2022 while sales volumes closed 9M 2023 at 4.90 million MT from 4.65 MT in 9M 2022, indicating a 6.52% increase. Net Income increased by 2.8% y/y to N76.07bn in 9M 2023 from N74.02bn in 9M 2022.

October was mainly characterised by bullish sentiments in the bourse, with the NGX ASI (+4.3% MoM) recovering from losses in September. The October rebound was supported by better-than-expected earnings and corporate actions, which masked concerns over the MSCI's proposed reclassification of Nigeria to a Standalone Status.

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Airtel Africa’s H1 2024 numbers were buoyed largely by growth in mobile money revenue (up 25.5% y/y to US$416m) and data revenue (+5.9% y/y to US$915m) amidst a decline in voice revenue (-4.6% to US$1.16m). However, the company’s bottom line performance was significantly impacted by FX losses, which resulted in a spike in the company’s Net Finance Cost (+144.1% y/y to US$873m), causing Profit before Tax to decline by 97.7% y/y to US$12m compared with US$330m in H1 2022.

The Afrinvest weekly sentiment advanced to 2.3x (previously at 2.0x). This week, we expect bargain hunting opportunities to boost market performance.

The bourse ended the week on a positive note as the NGX-ASI rose 4.6% w/w to close at 70,196.77 points. Consequently, YTD return improved to 37.0% and market capitalisation advanced ₦1.7bn to ₦38.6tn.

Across our coverage sectors, performance was bullish as 5 indices gained, while the Oil & Gas index closed flat. Leading the gainers, the AFR-ICT index advanced 11.7% w/w. Trailing, the Insurance and Banking indices advanced 8.0% and 2.7% w/w respectively. Similarly, Industrial and Consumer Goods rose 0.7% and 0.5% w/w respectively.

Top gainers for the week were MBENEFIT (+29.3%), JAPAULGOLD (+28.3%), and AIRTELAFRI (+27.9%), while RTBRISCOE (-14.0%), BETAGLAS (-10.5%), and MEYER (-9.9%) led the losers.

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October was a gory halloween for the global equities market as investors were mostly risk-off due to the higher yield environment, expectation of Fed rate hike, and the emergence of fresh geopolitical tension (Israel-Hamas war). As such, the MSCI World Index dipped 3.0% m/m. In the US, Fed Chair, Jerome Powell signaled that the policy rates could be held steady at its November 1st policy meeting, with warnings of hawkish decisions if inflation remains hot...