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H1:2023 GTCO Earnings Result | Remarkable Performance Riding on FX Revaluation Gains

In its recently released H1:2023 results, GTCO’s Gross Earnings jumped by 181.08% YoY1 to NGN672.60bn mainly due to the spike in non-interest income (+385.03% YoY to NGN446.66bn), an offshoot of the massive FX revaluation gains recorded in the period. Elsewhere, Operating Expenses increased by 26.26% YoY to NGN125.58bn. Profit Before Tax (PBT) and Profit After Tax (PAT) grew massively by 217.09% YoY and 261.65% YoY each to NGN327.40bn and NGN280.48bn respectively. Overall, Net Profit Margin improved by 9.29% to 41.70% in the period.

We have revised our target price for GTCo to NGN43.11 for 2023FY. At its current price of NGN38.80 as of 6th September 2023, this translates to an upside prospect of 11%. Thus, we put a “STRONG BUY” rating on the stock.

Underlying
GUARANTY TRUST HLDG

Provider
ARM Securities Limited
ARM Securities Limited

ARM Securities Limited is a full-service brokerage house that offers best-in-class brokerage services to local as well as foreign private and institutional investors. Formerly known as Hamilton Hammer, the Company commenced operation in 1994 and was acquired by ARM Investment Managers in 2008--an acquisition which has successfully re-positioned the company as a recognized brokerage firm in Nigeria. The Company is a dealing member of the Nigerian Stock Exchange (NSE) and is regulated by Securities and Exchange Commission (SEC). ARM Securities research team provides insightful commentaries on the Nigerian economy and its equity and debt markets using an approach which incorporates a thorough understanding of the fundamentals of the industries and companies under coverage. The research therefore adopts an integrated methodology of top-down analysis and bottom-up stock selection, which focuses on publicly quoted companies on the Nigerian Stock Exchange that are judged to offer the highest potential for earnings growth. In addition, its analysts provide periodic commentaries on a range of topical global and local issues which provide investing clients with a holistic view of the opportunities and risks in today’s financial market landscape. ​

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