Nigerian Exchange (NGX) Limited, has continued to provide a vibrant listing platform for government and corporates to meet their business objectives.
In the first quarter (Q1), 2023, NGX recorded N318.52 billion of listings across its equities, fixed income, mutual funds and derivatives categories in Q1.
Capital is critical for business growth. Companies can raise capital through debt or equity. Debt is issued in the form of bonds, and equity is issued in the form of shares. When a company issues new bonds or common stock, it is referred to as a new issue.
The stock exchange, as an important component of the capital market, plays a significant role in the capital formation process because of the tremendous opportunities that ensue from its activities. The exchange is expected to mobilize long-term savings to finance long-term investment by providing risk capital in the form of equity or quasi-equity to entrepreneurs.
New issues are savings mobilized for investment purposes by companies and governments. The new issues market represents the primary arm of the capital market and shows how many financial resources are invested in long-term securities of corporate bodies and governments.
The listing of new issues in the market will deepen the market, improve liquidity and tradability of companies’ shares. Also, it will increase access to capital in order to fund companies’ future growth initiatives.
This was contained the NGX X-Compliance report. The X-Compliance report is a transparency initiative of NGX designed to maintain market integrity and protect the investors by providing compliance-related information on all listed companies. Through the report, NGX ensures that it provides timely information to investors to aid their capital allocation decisions and enable a proper functioning capital market.
According to the report, NGX saw N11.23 billion in Federal Government of Nigeria bond listings which constituted FGN Savings Bonds with maturities ranging between 2024 and 2026. Lagos State Government issued the only bond by a sub-sovereign entity with its N137.33 billion series 1V, 10-year 13 per cent, Fixed Rate Bonds due 2031 under its N500 billion debt issuance program.
The corporate bond segment recorded N112.42 billion senior unsecured bond listing from Dangote Industries Funding Plc and N31.36 billion in Sukuk Issuances from Taj Bank and Family Homes under their respective Sukuk Issuance programmes.
FTN Cocoa Processors Plc and Neimeth International Pharmaceuticals Plc both did supplementary listings of N850 million and N3.68 billion of shares respectively. Africa Plus Partners Nigeria Limited also listed its mutual fund, Africa Infra Plus 1, the first Carbon Plus naira denominated fund to be listed on the Exchange, at a market value of N21.65 billion.
NGX said, it continued to drive participation in its derivatives market with the listing of NGX Pension index Futures Contract and NGX30 Index Futures Contract.
Recall that the chief executive officer, NGX, Mr Temi Popoola noted that the Exchange had a renewed focus on listings for the year 2023, saying “we will be using listings as a vehicle for meeting strategic aspirations as the new dispensation comes in through increased advocacy and engagements.”
The chief operating officer, InvestData Consulting Limited, Mr. Ambrose Omoriodon said, “The Nigerian Exchange provides access to long and medium terms finance for structured businesses. The Exchange is positioned to help multinational and local businesses and a wide range of investors gain an overriding view of the capital market as well as guide investors and businesses in making wise investment and finance choices.”
The managing director of HighCap Securities Limited, Mr. David Adonri however noted that in term of equity new issue, it has been scanty.
He noted that “most of the issues in Q1 were from fixed income and debt instrument and the federal government actually took control of the market. Generally, the new issue market is still suboptimal, it has not recovered fully to the pre-melt down era.”
