In FY'23, ETI's earnings defied notable currency weaknesses in Zimbabwe (- 89.0%), Nigeria (-50.0%), and Ghana (-29.0%), expanding by 11.0% to $406.9 million.
STANBIC crossed an earnings milestone (above N100.0 billion) in FY'23, aided by strong revenues from both net interest income (NII) and non- interest revenue (NIR).
Following a challenging Q1’24 earnings performance, we have set a new 12-month target price (TP) of N74.02 (vs N93.13 previously) while maintaining a HOLD recommendation.
Following the company's Q1'24 performance, we raise our target price slightly to N42.24, maintaining a BUY rating on the ticker. Our revision stems from an increase in volumes due to the expected rebound in construction activities and elevated cement prices (higher than the industry average) which will drive a strong top-line performance. Nevertheless, we note the impact of FX losses from Letters of Credit (LCs) and the higher-than-average effective tax rate on the company's bottom line.
Global raw sugar prices skyrocketed in 2023 due to reduced market supply, driven by unfavourable climate conditions and irregular rainfall. However, the average global raw sugar price (YTD average: $21.29/lb) is now 10.8% lower than the mean of 2023.
In FY'24, we expect FIDELITYBK to post a PBT of N171.5 billion, representing a possible c.38.0% expansion from its FY'23 print. This earnings projection is in line with the bank's guidance of N170.0 billion and consistent with potential benefits from the high-interest rate environment.
