Nigeria | NGX

The Afrinvest weekly sentiment improved to 1.6x (previously 1.4x). This week, we expect the market to trade positively on the back of improved investors’ sentiment.

Okomu Oil Palm Plc (OKOMUOIL) in its full year 2023 audited results reported an impressive 26.6% y/y growth in Revenue to N75.11bn from N59.32bn (FY 2022). On a q/q basis, Revenue declined, down 27.9% in Q4 to N14.46bn from N20.05bn recorded in Q3 2023. Though we observed a decline in CPO price in Q4 2023, we believe demand may have also been low. In FY 2023, the business grew its revenue from palm oil-produce by 24.7% to N67bn, rubber sales by 44.7% to N7.95bn, and palm oil processing by 54% to N120.4bn.

In FY 2023, MTN Nigeria saw substantial growth driven primarily by double-digit increases in both voice (+10% y/y to N1.14 billion) and data revenue (+40% y/y to N1.07 billion), despite experiencing inflationary pressures on Operating Expenses (+26.80% y/y to N615.82 billion). For 2024, we anticipate MTN Nigeria will sustain its robust topline growth. Our projections indicate a 45% y/y growth in data revenue and an 8% y/y growth in voice revenue. Overall, we forecast a 26.1% y/y increase in Revenue to N3.11 trillion in 2024 from N2.47 trillion in 2023.

The stricter requirement that banks are to meet the new capital thresholds with paid-up share capital and share premium only leaves our coverage names in a capital shortfall position. This exclusion of other forms of capital is quite significant given that these other sources account for c. 76.0% of total equity across our coverage. Specifically, the capital of our coverage banks comprises AT-1 (1.7%), retained earnings (27.4%), issued share capital & premium (24.0%), and other reserves (47.1%).

In its 2023 audited financial results, UAC of Nigeria Plc. (UACN) reported a 10.3%y/y growth in Revenue to N120.53bn from N109.27bn in FY 2022. The Animal Feeds and Other Edibles, Paints, Packaged Foods & Beverages, and the Quick Service Restaurants (QSR) revenue segments reported growth in sales to the tune of N64.17bn, N23.89bn, N28.55bn and N3.72bn in FY 2023 from N63.46bn, N19.21bn, N23.23bn and N3.08bn in FY 2022 respectively. However, Other Revenue declined to N205m in 2023 from N297m in 2022.

The NGX-ASI closed the month with a 4.6% uptick to print at 104,562.06 points. Resultantly, YTD return printed at 39.8% (previously 33.7%) while market capitalisation advanced 8.1% m/m to ₦59.1tn. Monthly trading activity improved as average volume and value traded rose 9.7% and 88.4% m/m to 595.7m units and ₦16.4bn, respectively. TRANSCORP (1.3bn units), GTCO (625.1m units), and UBA (621.5m units) were the top traded stocks by volume for the month, while GTCO (₦28.8bn), TRANSCORP (₦22.4bn), and ZENITH (₦18.4bn) led by value.