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Breakfast Report - 13 May, 2019

In a bid to support growth of small and medium-sized enterprises (SMEs) in Nigeria, the Nigeria Stock Exchange (NSE) has proposed the creation of a new listing platform, with the aim of enabling SMEs and start-ups to list shares and raise capital through the stock market. The platform, known as the ‘Growth Board’, will be the fourth board on the exchange, and has been approved by the Securities and Exchange Commission. The new platform would create two segments for start-ups, micro, small and medium – sized companies. Companies looking to list, must have a market capitalization of ₦50 million, have at least 25 shareholders and make available a minimum of 10% of its shares to minority retail investors.  According to the CBN, SMEs account for c.96% of Nigerian business but only contribute c.48% to GDP (2017 estimate), due to a poor financial support and credit environment amongst other challenges. With the growth board set to unlock financing opportunities for SMEs, we highlight the opportunities for improvement in this segment of the economy. In a bid to support growth of small and medium-sized enterprises (SMEs) in Nigeria, the Nigeria Stock Exchange (NSE) has proposed the creation of a new listing platform, with the aim of enabling SMEs and start-ups to list shares and raise capital through the stock market. The platform, known as the ‘Growth Board’, will be the fourth board on the exchange, and has been approved by the Securities and Exchange Commission. The new platform would create two segments for start-ups, micro, small and medium – sized companies. Companies looking to list, must have a market capitalization of ₦50 million, have at least 25 shareholders and make available a minimum of 10% of its shares to minority retail investors.  According to the CBN, SMEs account for c.96% of Nigerian business but only contribute c.48% to GDP (2017 estimate), due to a poor financial support and credit environment amongst other challenges. With the growth board set to unlock financing opportunities for SMEs, we highlight the opportunities for improvement in this segment of the economy.

Equity: As the All Share Index continues to trade comfortably below 30,000 points the outlook appears dim. However, we expect investors to take advantage of beaten down prices today, but do not rule out the possibility of further sell-offs. Equity: As the All Share Index continues to trade comfortably below 30,000 points the outlook appears dim. However, we expect investors to take advantage of beaten down prices today, but do not rule out the possibility of further sell-offs.

Stock Watch: SEPLAT led the offer cart on Friday, shedding 998bps to settle at ₦522.00. While global oil prices are healthy, the Oil & Gas sector has shed 12% YTD and SEPLAT has declined 18% YTD. Stock Watch: SEPLAT led the offer cart on Friday, shedding 998bps to settle at ₦522.00. While global oil prices are healthy, the Oil & Gas sector has shed 12% YTD and SEPLAT has declined 18% YTD.

Fixed Income: Given the current trend observed during the week, we foresee a continuation of positive trading activity today. Meanwhile, in the bond space, due to the continued weak investor interest and despite the yield declines on benchmark bonds, we expect a dearth of trading activity in the bond space. Fixed Income: Given the current trend observed during the week, we foresee a continuation of positive trading activity today. Meanwhile, in the bond space, due to the continued weak investor interest and despite the yield declines on benchmark bonds, we expect a dearth of trading activity in the bond space.