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BusinessDay 09 Apr 2018

Monday

Monday 09 April 2018 32 BUSINESS DAY Live @ The Stock Exchange Top Gainers/Losers as at Friday 06 April 2018 Market Statistics as at Friday 06 April 2018 GAINERS Company Opening Closing Change NESTLE N1380 N1385 5 UNILEVER N55 N59.8 4.8 DANGSUGAR N20.75 N21.45 0.7 NB N128.3 N129 0.7 MAYBAKER N2.92 N3.2 0.28 LOSERS Company Opening Closing Change MOBIL N183 N170 -13 TOTAL N249 N236.6 -12.4 INTBREW N51.7 N49.15 -2.55 GLAXOSMITH N31.5 N29 -2.5 FO N41.9 N40 -1.9 ASI (Points) 40,841.14 DEALS (Numbers) 6,108.00 VOLUME (Numbers) 501,963,433.00 VALUE (N billion) 5.846 MARKET CAP (N Trn 14.753 Stock investors lost N240bn last week …Unic, Sovereign Trust, FTN Cocoa disappoint with over 50% price decline Stories by Iheanyi Nwachukwu Year-to-date (ytd) returns from Nigerian stock market declined to 6.79percent on Friday even as equity investors lost about N240billion last week. The stock market declined by 1.6percent in first trading week in April as the bears dominated Customs Street trading despite positive corporate earnings that were reported. Nineteen (19) equities appreciated in price last week, lower than 40 in the preceding trading week. Fifty-three (53) equities depreciated in price, higher than 40 equities of the preceding week, while 99 equities remained unchanged, higher than 91 equities recorded in the preceding week. Last week was another four-day trading week, as the Federal Government declared Monday, April 2 as a public holiday for the Easter celebrations. The market recorded total turnover of 1.765 billion shares worth N26.562 billion in 20,265 deals in contrast to a total of 2.328 billion shares valued at N28.927 billion that exchanged hands the preceding week in 25,530 deals. Vetiva Capital analysts in their April 3, 2018 equity research anticipated another modest performance in this second-quarter (Q2) of 2018 to be “driven by improving economic landscape and expectation of better first-quarter (Q1) 2018 earnings.” In the trading week to April 6, 2018, the Nigerian Stock Exchange (NSE) All Share Index (ASI) declined to 40,841.14 points, from a high of 41,504.51 points as at the preceding weekend. Likewise, the value of listed equities closed at N14.753trillion last Friday, a decline from N14.993 trillion recorded the preceding Friday March 30. Some stocks that have failed to impress investors this year include UnityKapital Assurance Plc which lost 54percent of its share price; Unic Insurance which also decline by 60percent; and Sovereign Trust Insurance Plc (-60percent). Others are: FTN Cocoa Processors Plc (-60percent); and Courteville Business Solutions Plc which recorded a decline of 54percent year-to-date. After four months of dormancy as a result of failure to form a quorum in the heart of executive and legislative government face-off, the Monetary Policy Committee (MPC) of the Central Bank of Nigeria last week FCMB Group reports N170bn full year gross revenue FCMB Group Plc last week released its audited financial results for the year ended December 31, 2017, reporting a gross revenue of N169.9 billion. The Group recorded a profit before tax (PBT) of N11.5billion, while profit after tax (PAT) was N9.4billion. In demonstration of the enhanced confidence of customers in FCMB, deposits grew to N689.9billion as at the end of December 2017, an increase of 5percent, from N657.6billion in the corresponding year. The Group’s capital adequacy ratio also improved to 16.9percent from 16.7percent, just as asset base increased to N1.19trillion, compared to N1.17trillion at the end of 2016. Non-interest income as at the end of 2017 was N32billion, while loans and advances stood at N649.8billion. held its first meeting of the year. At the end of the twoday policy meeting, all members of the Monetary Policy Committee (MPC) in attendance voted to leave key monetary policy rates unchanged. GTI research analysts in their outlook for the month of April 2018 expect positive economic environment to dictate major activities in the month. “We expect to see a lower reading for March inflation, an improved first-quarter (Q1) GDP and improved March PMI (already released). These are expected to have a positive impact on Q1 earnings releases. This would likely buoyed market reprising considering that we have witnessed extended oversold of main indicators as a results of recent market correction and significant profit taking,” according to GTI research analysts. By and large, GTI expects a positive market bearing in this month. In the meantime, they strongly advise investors to take a keen interest on firms’ fundamentals before taking an investment position on such firms. “In spite of the reduction in the headline numbers, the Group’s performance for the year 2017 witnessed an improvement in core operating performance over the previous year after adjusting for the significant foreign exchange revaluation income enjoyed in 2016”, FCMB Group said in a statement following the released results. “In line with the repositioning strategy of the Group for better performance, the key drivers of the performance include increase in income from our non-banking activities, lower impairment charges from the Bank and its subsidiaries, and improved operating efficiencies through more pervasive use of technology”, the Group further stated. In November 2017, FCMB completed the acquisition of an additional 60percent stake in Legacy Pension Managers Limited, which increased FC- MB’s stake from 28.2percent to 88.2percent, thereby making Legacy a subsidiary of FCMB. The acquisition helps achieve further diversification of service offerings and, consequently, earnings within the FCMB Group, which will be felt from the 2018 financial year. FCMB Microfinance Bank Limited, the Group’s dedicated group lending and financial inclusion vehicle, commenced operations as a state microfinance bank in January 2017. The business will be the key driver of FCMB’s informal and agricultural sectors (particularly small-holder farmers) drive across the country. Cordros sees downside potential in GTBank stock Though the share price of Guaranty Trust Bank Plc closed Thursday April 5, 2018 at N44.10, analysts at Cordros Capital still see downside potential from the current level. Pursuant to the postlisting rules of the Nigerian Stock Exchange (NSE) for listed companies, the board of directors of GT- Bank Plc will be meeting on Wednesday April 18, 2018 to consider the unaudited financial statements for the first-quarter (Q1) ended March 31, 2018. Ahead of this meeting, in their last weekly stock recommendation, the Lagos-based research analysts’ said their target price (TP) for GTBank stock stands at N42.81. It was previously N42.45). “Our estimates are under review,” according to the Cordros Capital. “Guaranty Trust Bank Plc trades at forward Price to Earnings (PE) of 8.72x, above its 5-year average of 6.2x.”, according to Cordros Capital research analysts. GTBank audited financial results for the year ended December 31, 2017 Segun Agbaje, MD, GTBank show gross earnings for the year grew by 1.1percent to N419.2billion from N414.6billion reported in the December 2016; driven primarily by growth in interest income as well as e-payment revenues. Profit before tax (PBT) stood at N200.2billion, representing a growth of 21.3percent over N165.1billion recorded in the corresponding year ended December 2016. The bank’s loan book dipped by 8.9percent from N1.590trillion recorded as at December 2016 to N1.449trillion in December 2017 while customer deposits increased by 3.8percent to N2.062trillion from N1.986trillion in December 2016. IOSCO recommends improved regulatory reporting, transparency in corporate bond markets The Board of the International Organisation of Securities Commissions (IOSCO) has published its recommendations for improving the information on secondary corporate bond markets available to both regulators and the public. The recommendations seek to ensure that regulators have better access to information so they can perform their functions more effectively, and to enhance crossborder information sharing and understanding. The transparency recommendations aim to support the price discovery process and facilitate better informed investment choices. Updating IOSCO´s 2004 report on Transparency of Corporate Bond Markets, the Regulatory Reporting and Public Transparency in the Secondary Corporate Bond Markets report makes seven recommendations that emphasise the importance of ensuring the availability of information to regulators, through reporting, and to the public, through transparency requirements. The report recommends that regulatory authorities should ensure that they have access to sufficient information to perform their regulatory functions effectively. In addition, it recommends regulatory authorities should have clearer regulatory reporting and transparency frameworks to facilitate better crossborder understanding of corporate bond markets. The report also recommends that regulatory authorities should consider steps to enhance pre-trade transparency in corporate bond markets and implement regimes that require post-trade transparency.

Monday 09 April 2018 C002D5556 BUSINESS DAY 33

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