Gross earnings rose 40.97% YoY to NGN269.99bn (slightly exceeding our expectation at about 27% of our 2023FY estimates) on the wheels of increased interest and non-interest income.
Interest Income climbed 51.63% YoY to NGN191.63bn while Non-Interest Income grew by 20.30% YoY to NGN78.36bn. On the other hand, Operating Expenses rose 19.50% YoY to NGN99.21bn owing to rising energy costs and regulatory costs. Consequently, Net Profit Margin slipped by 5.94% to 24.45% in the period. Profit Before Tax (PBT) and Profit After Tax (PAT) grew by 27.38% and 13.43% to NGN86.61bn and NGN66.01bn respectively.
We have revised our target price for Zenith Bank to NGN24.04 and based on its closing price of NGN24 as of 3rd May 2023, we put a “NEUTRAL” rating on the stock.
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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