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The Market Today - 01 March 2018

MTN set May/June for roadshow, listing in July                                                               

According to news sources, MTN Nigeria plans to list its ordinary shares (estimated at $5.23 billion) on the Nigerian Stock Exchange by July 2018, with plans set to go on a roadshow between May and June. The telecoms giant plans to split its current 402 million ordinary shares (currently trading at $13) into 50 units each, taking its total shares outstanding to 20 billion shares. With the price to be set via book building, MTN Nigeria plans to use the proceeds to redeem its preference shares in issue in a bid to reduce its currency exposure. The prospect of MTN Nigeria listing on the exchange remains a plus as it would serve as a boon for market deepening, widen the sector diversity on the exchange, provide more investment opportunities, as well as ensure that the capital market is a better representation of the wide economy. With market and economic dynamics expected to improve further, we remain cautiously optimistic that the telecom giant would follow through on its listing.                                                             

ASI roars to life as Blue-Chip stocks post gains                                                  

Driven by a sudden resurgence in buying interest across several Blue- Chip names, the Nigerian bourse soared 244bps higher, taking week-to-date gains back into the green at midweek. With a number of key stocks remaining on the bid cart at session close, we expect trading today to start on a positive note even as investors monitor expected corporate earnings releases.                                                          

Stock Watch: Currently priced the lowest on the Nigerian bourse, UNIC Insurance trades at ₦0.24 after losing 52% of its value since the amendment of the NSE par value rules. The stock joins a throng of Insurance sector names now trading below the ₦0.50 mark. The stock has also lost 52% ytd.                  

All square in Fixed income sphere                                                         

The CBN conducted a Primary Market Auction in the T-bills space yesterday, offering and selling ₦130 billion across the 91DTM, 182DTM and 364DTM bills at respective stop rates of 11.85%, 13.50% and 13.50% (effective yields: 12.21%, 14.47% and 15.60%). Meanwhile, trading in the secondary T-bills market was varied with buying interest weighted across the mid to long end of the space, whilst sentiment on the short end turned bearish. The bond market was similarly mixed, with yields on benchmark bonds holding steady on average at session close. With stop rates at yesterday’s PMA cutting off below secondary market levels, we anticipate a downward adjustment to yields across the T-bills market, with a sharper adjustment at the long end of the space. Meanwhile, we foresee another quiet session in the bond market amidst a paucity of market catalysts.