Vetiva Capital Management

​Vetiva provides clients with independent and unbiased access to analysis and opinion. We keep our clients on the cutting edge of market information and provide up to date market intelligence on quoted companies. Our services allow brokers, investment firms, and asset managers focus their energies on developing investment strategies and client relationships.

Vetiva Research
  • Vetiva Research

Breakfast Report - 18 March 2024

Headline inflation rose by +180bps to 31.70% y/y in February (January: 29.90% y/y).  We attribute the surge to sustained security challenges in food producing states. Food inflation surged to a new 19-year high of 37.92% y/y (Jan’24: 35.41% y/y) on the back of sustained pressures on the prices of both farm (+68.27% y/y) and processed (+32.85% y/y) produce. Annual core inflation, which measures the change in non-food prices, rose by 123bps to 24.67% y/y in February (Jan’24: 23.44% y/y). This is a...

Vetiva Research
  • Vetiva Research

AB InBev SA/NV FY'23 Earnings - Volume slump, higher costs drag full-y...

Volume decline drags revenue performance AB InBev’s revenue for the Q4 period fell marginally (-1% y/y) to $14.5 billion. This came as price increase was unable to mask the effect of volume decline. While price increase sent revenue per hl higher by 9.3% y/y, the elastic nature of consumer demand for AB-InBev’s product, caused volumes to dip by 2.6% y/y as consumers reacted to this price increase. Thus, revenue for the period came in lower. Finance costs take its tollFor the company’s operating...

Vetiva Research
  • Vetiva Research

NESTLE NIGERIA PLC FY'23 EARNINGS - Naira volatility upturns operation...

  Price jump combats volume declineNestle Nigeria showcased remarkable resilience in Q4'23, achieving a substantial 33% y/y growth in revenue, totaling ₦150.5 billion. The company’s two product segments recorded growth in Q4’23. Food was ₦99.3 billion (+38.5% y/y) while Beverage was ₦51.2 billion (+23.1% y/y). Also, Nestle’s cost of sales grew at a slower pace, +25% y/y to ₦93.5 billion in Q4’23. Thus, gross profit grew by 48% y/y in Q4’23 to ₦57 billion, pushing gross margin to 38% (Q4’22: 34%...

Vetiva Research
  • Vetiva Research

Breakfast Report - 26 February 2024

The National Bureau of Statistics confirmed that Nigeria’s GDP expanded by 3.46% y/y in Q4’23, which is 28bps above our estimate (Vetiva: 3.18% y/y) and 93bps above Bloomberg Consensus estimate (2.53% y/y). This represents the best quarterly expansion during the year and can be attributed to the recovery in the oil sector. For the record, the oil sector recorded its first positive output growth since March 2020, thus recovering from a 3-year-long recession. Overall, this contributed to the full-...

Vetiva Research
  • Vetiva Research

NIGERIAN BREWERIES PLC FY'23 EARNINGS - Price increases mask volume de...

Robust revenue growth in a challenging landscapeNigerian Breweries navigated a turbulent business landscape in Q4'23, marked by significant shifts in the Nigerian economy. Despite these challenges, the company achieved a commendable 26% y/y growth in revenue, reaching ₦197.8 billion in Q4’23. This growth, in the face of cash shortages, high inflation rates, and overall thinning consumer wallets underscores the impact of the price increases implemented across its catalogue during the period. Ulti...

Vetiva Research
  • Vetiva Research

Breakfast Report - 04 December 2023

President Bola Tinubu laid the 2024 Budget Proposal at the National Assembly, this week. The ₦27.5 trillion budget (+10% y/y) will be funded by oil revenue (₦7.9 trillion), and non-oil revenue (₦10.4 trillion), leaving a deficit of ₦9.2 trillion, which will be funded largely from domestic sources. The government expects Federation Account revenue to more than double due to the depreciation of the exchange rate, higher oil production projection, and the removal of subsidies. The budget is p...

Ibukunoluwa Omoyeni
  • Ibukunoluwa Omoyeni

Inflation rises despite waning momentum

In October, headline inflation decelerated to 1.73% m/m (Sep’23: 2.10% m/m). The m/m slowdown in inflation was on the back of broad-based slowdown in both food and core inflation. Notably, food inflation decelerated to 1.91% m/m (Sep’23: 2.45% m/m) while Core inflation slipped to 1.42% m/m (Sep’23: 2.06% m/m). Overall, headline inflation rose by 61bps to settle at 27.33% y/y (Vetiva: 27.58%). Food inflation: High farmgate prices keep food inflation above 30%Amid the harvest season, fo...

Vetiva Research
  • Vetiva Research

Breakfast Report - 04 September 2023

The Week Ahead   In Q2’23, Nigeria’s real GDP growth slowed to 2.51% y/y, 22bps lower than our estimate (Vetiva: 2.73% y/y) and 103bps lower than the Q2’22 outcome (3.54% y/y). While the agricultural sector expanded at a faster pace, growth in the services sector slowed, and the industrial sector contracted. We attribute this outcome to the normalization of post-COVID economic activities and a sustained relapse in the oil sector. Despite the pipeline surveillance contract, the upstre...

Ibukunoluwa Omoyeni ... (+2)
  • Ibukunoluwa Omoyeni
  • Vetiva Research

NIGERIA GROSS DOMESTIC PRODUCT - GDP expands by 2.51% y/y, oil sector ...

In Q2’23, Nigeria’s real GDP growth slowed to 2.51% y/y, 22bps lower than our estimate (Vetiva: 2.73% y/y) and 103bps lower than the Q2’22 outcome (3.54% y/y). We attribute this outcome to the normalization of post-COVID economic activities and a sustained relapse in the oil sector. While the agricultural sector expanded at a faster pace, growth in the services sector slowed, and the industrial sector contracted. Industrials: Oil contraction weighs on growth outcomeThe oil sector rema...

Ibukunoluwa Omoyeni ... (+2)
  • Ibukunoluwa Omoyeni
  • Vetiva Research

November 2021 Inflation review - Base effects override festive pressur...

Base effects override festive pressures According to the National Bureau of Statistics, inflation trended downwards for the eighth consecutive month in November. Falling to 15.40% y/y (Vetiva: 15.24% y/y), headline inflation continues to benefit from the decision to retain fuel subsidies and the harvest season. On a month-on-month basis, however, inflation rose at a faster pace (Nov’21: 1.08% m/m), amid the frontloading of household items ahead of the festive season. Food inflation decelerates...

Vetiva Research
  • Vetiva Research

AB InBev SA/NV FY'23 Earnings - Volume slump, higher costs drag full-y...

Volume decline drags revenue performance AB InBev’s revenue for the Q4 period fell marginally (-1% y/y) to $14.5 billion. This came as price increase was unable to mask the effect of volume decline. While price increase sent revenue per hl higher by 9.3% y/y, the elastic nature of consumer demand for AB-InBev’s product, caused volumes to dip by 2.6% y/y as consumers reacted to this price increase. Thus, revenue for the period came in lower. Finance costs take its tollFor the company’s operating...

Vetiva Research
  • Vetiva Research

NESTLE NIGERIA PLC FY'23 EARNINGS - Naira volatility upturns operation...

  Price jump combats volume declineNestle Nigeria showcased remarkable resilience in Q4'23, achieving a substantial 33% y/y growth in revenue, totaling ₦150.5 billion. The company’s two product segments recorded growth in Q4’23. Food was ₦99.3 billion (+38.5% y/y) while Beverage was ₦51.2 billion (+23.1% y/y). Also, Nestle’s cost of sales grew at a slower pace, +25% y/y to ₦93.5 billion in Q4’23. Thus, gross profit grew by 48% y/y in Q4’23 to ₦57 billion, pushing gross margin to 38% (Q4’22: 34%...

Vetiva Research
  • Vetiva Research

Breakfast Report - 26 February 2024

The National Bureau of Statistics confirmed that Nigeria’s GDP expanded by 3.46% y/y in Q4’23, which is 28bps above our estimate (Vetiva: 3.18% y/y) and 93bps above Bloomberg Consensus estimate (2.53% y/y). This represents the best quarterly expansion during the year and can be attributed to the recovery in the oil sector. For the record, the oil sector recorded its first positive output growth since March 2020, thus recovering from a 3-year-long recession. Overall, this contributed to the full-...

Vetiva Research
  • Vetiva Research

NIGERIAN BREWERIES PLC FY'23 EARNINGS - Price increases mask volume de...

Robust revenue growth in a challenging landscapeNigerian Breweries navigated a turbulent business landscape in Q4'23, marked by significant shifts in the Nigerian economy. Despite these challenges, the company achieved a commendable 26% y/y growth in revenue, reaching ₦197.8 billion in Q4’23. This growth, in the face of cash shortages, high inflation rates, and overall thinning consumer wallets underscores the impact of the price increases implemented across its catalogue during the period. Ulti...

Vetiva Research
  • Vetiva Research

Price increases boost gross margin

Pricing increases elevate toplineIn the fourth quarter of 2023, International Breweries demonstrated a substantial 38% y/y growth in revenue, reaching ₦80.5 billion. This impressive increase was due to higher prices across the firm’s product lines. While INTBREW has maintained its lowest price strategy, its products’ prices significantly rose in FY’23 due to the inflationary environment. These higher prices helped improve the firm’s gross margin to 18% in Q4’23 (Q4’22: 11%) as cost of sales rose...

Vetiva Research
  • Vetiva Research

Breakfast Report - 18 March 2024

Headline inflation rose by +180bps to 31.70% y/y in February (January: 29.90% y/y).  We attribute the surge to sustained security challenges in food producing states. Food inflation surged to a new 19-year high of 37.92% y/y (Jan’24: 35.41% y/y) on the back of sustained pressures on the prices of both farm (+68.27% y/y) and processed (+32.85% y/y) produce. Annual core inflation, which measures the change in non-food prices, rose by 123bps to 24.67% y/y in February (Jan’24: 23.44% y/y). This is a...

Vetiva Research
  • Vetiva Research

Breakfast Report - 15 January 2024

  As we expect Nigeria’s December inflation print this week, we believe inflation rose above 29% due to year-end festivities and the sustained passthrough of high transport prices. For much of H1’24, inflation could remain above the 30% handle, driven by low base effects in the context of PMS pricing. Amid these expected pressures, the Central Bank hinted at the adoption of an inflation targeting framework at the Annual Banker’s Committee Dinner. Literature tells us that inflation targeting i...

Vetiva Research
  • Vetiva Research

Breakfast Report - 02 January 2024

Oil production fell short of target in 2023, despite high oil prices and a favourable OPEC production quota (initially 1.7 mb/d). The devaluation of the Naira and removal of subsidies were key revenue drivers for the year, as the former shored up the naira equivalent of oil USD receipts while the latter reduced the deductions made to gross oil revenues. Notwithstanding, the shortfall in oil production weighed on the contribution of oil to federation revenues. Gross oil and gas revenues (9M...

Vetiva Research
  • Vetiva Research

FY’24 SSA Industrials Outlook: A glimpse of hope

Price hikes offset declining volumesIn 2023, the cement industry experienced a decline in volumes attributed to cash shortages, election uncertainties, and prolonged heavy rainfall, which impeded construction activities… .  Price cut triggers industry uncertaintyIn October, BUA Cement made a surprising announcement to reduce the ex-factory price of cement in Nigeria from ₦4,200 to ₦3,500 per bag. While this was met with excitement as it was seen as a potential relief to Nigeria’s housing cost c...

Vetiva Research
  • Vetiva Research

Breakfast Report - 11 December 2023

  Over the weekend, Moody’s upgraded Nigeria’s sovereign credit rating outlook from stable to positive, while retaining Nigeria’s local currency rating at B2 and its foreign currency rating at Caa1. Since Moody’s downgrade in January, Nigeria has implemented key policies to address issues raised earlier. The favourable change in outlook was driven by the possible reversal of the deterioration in Nigeria's fiscal and external position as a result of the authorities' reform efforts. According to ...

Nigeria Gross Domestic Product - Q2'18: Economic Growth Slows Amid Agr...

Economic growth slows amid agriculture concerns                                                                          Compared to Vetiva and Consensus estimates of 1.6% and 2.0% respectively, Nigeria’s reported Q2’18 real GDP growth of 1.5% is disappointing. Although our estimate was close to the reported figure, the composition of GDP growth in the period is somewhat surprising. There was a more marked slowdown in agriculture and oil production than we had anticipated, growth in the service...

The Market Today - 26 July 2018

CBN plans more private sector credit despite hawkish tune                                                        Having corroborated the argument that a reduction in policy rate would not necessarily translate to increased credit to private sector, owing to structural impediments, the MPC highlighted key steps the CBN should take in a bid to stimulate credit expansion to the economy. Particularly, the Committee hinted that the CBN would provide direct credit intermediation by purchasing commerc...

Chinma Ukadike ... (+2)
  • Chinma Ukadike
  • Vetiva Research

Breakfast Report - 31 October 2022

The Central Bank of Nigeria (CBN) Governor announced last week that it will issue new Naira banknotes. The new bank notes (₦200, ₦500, and ₦1000 denominations) will be introduced in December 2022, and the old notes will be phased out by January 2023. According to the Governor, the decision was taken to tackle significant hoarding by members of the public, worsening shortage of clean banknotes, and increased ease of counterfeiting. Bank charges for cash deposits are statutorily suspended du...

Joshua Odebisi ... (+2)
  • Joshua Odebisi
  • Vetiva Research

STANBIC ITBC HOLDINGS PLC FY'21 (Unaudited) Earnings Release - Profits...

Profits dip 30% y/y amid weaker Non-Interest Revenues                                               STANBIC recently released its (Unaudited) FY’21 earnings, reporting a 12% y/y decline in Gross Earnings to ₦205.9 billion. Although Interest Income declined by only 1% y/y to ₦104.7 billion, the bank’s Non-Interest Revenue fell 21% y/y to ₦101 billion, dragged by a 74% drop in trading revenue. Interestingly, the bank’s Q4 performance was consistent with prior years; gross earnings for the period...

Vetiva Research
  • Vetiva Research

MONETARY POLICY DECISION - CBN leaves rates unchanged for the umpteent...

In its first meeting of the year, Nigeria refused to join its African counterparts in raising its Monetary Policy Rate (MPR). Angola, Ghana, and South Africa raised interest rates in 2021 to surmount biting inflationary pressures. Kenya and Nigeria, on the other hand, left their benchmark rates constant to support recovery.   Current Monetary Policy Variables Instrument Current Rate Since Previous Rate Monetary Policy Rate 11.50% 22-Sep-20 ...

Vetiva Research
  • Vetiva Research

December 2021 Inflation: Inflation rises for the first time in 9 month...

The National Bureau of Statistics (NBS) has confirmed that inflation nudged higher in the month of December. We note that the surge in month-on-month inflation to 1.82% m/m is the largest month-on-month print since May 2017.  Thus, headline inflation rose to 15.63% y/y in December, 23bps above November’s print (15.40% y/y) and 74bps above Bloomberg consensus estimate of 14.87% (Vetiva: 14.79%). Energy inflation rose to a 4-year peak In December, we observed that the Housing, Water, Gas, and ot...

Vetiva Research
  • Vetiva Research

SSA Consumer Goods Report - A resilient industry

Suffering from pandemic-exacerbated challenges like supply chain bottlenecks, increased operational inefficiencies and reduced physical interactions/demand, the FMCG industry has proved quite resilient as amid these disruptions from the pandemic, the industry is estimated to have grown by 10% y/y in 2020. As such, the growth prospects for the industry cannot be denied and remains viable.  Africa’s population size has been a key consideration in the attractiveness of the region as an i...

ResearchPool Subscriptions

Get the most out of your insights

Get in touch