- Market capitalization now N2.95trn
- Share price records 61% in five days
Investors of MTN Nigeria Plc. have recorded a gain of N1.12 trillion or 60.94 per cent within the last five trading session the company’s shares were quoted on the Nigerian Stock Exchange (NSE). The Exchange had, on May 16, 2019 admitted 20.354 billion units of shares of MTN Nigeria Plc. at N90 per share on the premium board of the Daily Official List of the Exchange. The landmark listing of 100 per cent of issued and paid-up ordinary shares of the telecom firm, which is the second largest seen by the stock exchange after Dangote Cement Plc., added N1.8 trillion to the market capitalisation of the equities market. Investigation by New Telegraph, revealed that the stock market performance All Share index had, on Thursday, May 16, grew by 0.54 per cent, halting nine days sustained downward trend following listing of MTN Nigeria Plc. on the Daily Official List.
The company’s shares, which were listed at N90 per share, closed the day at N99 and N2.015 trillion in market capitalization. On Friday May 17, the telecom giant added a gain of N9.90 or 10 per cent exchanged at 32.098 units to close at N108.9 per share at a market capitalisation of N2.216 trillion. With investors exchanging 51.4 million units, MTN Nigeria gained N10.85 or 9.96 per cent on Monday, May 20, to close at N119.75 per share at a market capitalization of N2.437 trillion. The company’s market capitalization grew to N2.680 trillion with a gain of N11.95 or 9.98 per cent to close at N131.70 per share.
The telecom firm recorded N13.15 or 9.98 per cent yesterday to close at N144.85 per share to grow the market capitalisation to N2.95 trillion, recording a cumulative growth of N54.85 or 60.94 per cent in the last five trading sessions. Market watchers believe that at this level, the total value of MTN Nigeria stocks was just about N250 billion less than that of Dangote Cement Plc. at N3.203 trillion which, before the listing of MTN, controls about 28 per cent of entire market capitalisation. According to the analysts, this implies that if MTN achieved another 10 per cent permissible limit, it may surpass Dangote Cement Plc. as the most capitalized stock on the Nigerian Stock Exchange. Professor of finance and capital market, and Chair, Banking and Finance Department, Nasarawa State University, Uche Joe Uwaleke, told New Telegraph that the MTN listing on the NSE is expected to boost market liquidity, diversify offerings as the telco would become the second most capitalized company in the market, after Dangote Cement Plc. “MTN Listing which promises to increase market cap by about N2 trillion, representing circa 13.3 per cent of market cap, making MTN the second most capitalized stock, is one of the possible reasons for expected bullish sentiment during the third quarter of the year,” he said. Uwaleke said that listing of MTN would help in product diversification at the exchange. “This will help to diversify concentration, we will now have telecommunications, industrial sector and not when it’s only Dangote.
“It’s a welcome development and the capital market community is in jubilation mood and we are anxiously waiting for that to materialise, because it will help to deepen the market and give Nigerians the opportunity to partake in the fortunes of MTN,” Uwaleke stated. He noted that MTN’s listing would widen the choices of both local and foreign investors in terms of investment decision. “It is also a door opener for other multinationals to come and be part of success story of Nigerian capital market by seeking listing, especially those in telecommunications sector such as Globacom and Etisalat, among others. “We expect the big four to come and list on the exchange. The same with oil companies. Shell is not yet listed, but we also know that in South Africa, the downstream sector is listed on Johannesburg Stock Exchange.
“Companies in the downstream sector should be sensitised to list on NSE. It’s not about making it compulsory for them to list; it’s about making them understand why they have to list. “Apart from the fact that it helps you to raise capital, it’s an opportunity to contribute to the development of the very place where you are making your money from; the bulk of MTN money is coming from Nigeria. “It will open doors for others to come and list and if they do that, the Nigerian Capital Market will be on its way to becoming Africa’s largest stock market, if they all come and list. I’m sure we will beat South Africa,” Uwaleke said.