MTN's Listing On NSE Premium Board Takes Market Out Of Bearish Trend

The long anticipated listing of MTN on the premium board of the Nigerian Stock Exchange (NSE) took place on Thursday 16th of May with MTN Nigeria Communications Plc introducing 20.35 billion shares at N90 per share

The long anticipated listing of MTN on the premium board of the Nigerian Stock Exchange (NSE) took place on Thursday 16th of May with MTN Nigeria Communications Plc introducing 20.35 billion shares at N90 per share. The listing could not have been timelier as it halted nine consecutive days of bearish trend on the NSE.

The listing added N1.83 trillion to the market capitalization, making market capitalization rise by N1.89 trillion or 17.87 per cent to close at N12.526 trillion against the N10.627 trillion that was recorded on Wednesday in the market.

The All Share Index (ASI) also gained 152.11 points or 0.54 per cent to close at 28,438.19 compared with 28,286.08 achieved on Wednesday. The listing was done by way of an introductory listing, meaning that the shares of existing MTN Nigeria shareholders will be listed without an additional public sale of shares.

This event puts MTN Nigeria as the first telecommunications network provider to be listed on the NSE Premium Board - which is a listing segment for the elite group of issuers that meet The Exchange’s most stringent listing standard. The premium board entails that companies listed on it are of uptmost behavior in terms of having a strong commitment to corporate governance, display excellence in their dealings, ensure efficiency in service delivery and prioritise shareholders’ wealth maximization.

Companies currently on the board include FBN Holdings Plc, Dangote Cement Plc, Seplat Petroleum Development Company, and Zenith International Bank Plc, to mention a few.

MTN Nigeria had only recently, announced its earnings for the first quarter which ended March 31, 2019, showing a 13.4% growth in service revenue. The listing, which is the NSE’s 2nd largest is expected to set the pace for other telecommunication companies to list their shares on The Exchange.

It will also enhance liquidity for MTN Nigeria, increase the transparency of the company to the general public while also increasing the value of its stocks.

Regarding the state of the overall market, analysts at Afrinvest Limited told Premium Times Nigeria that “Following the significant buying interest on the newly listed MTNN on the exchange, we expect the local bourse to maintain its bullish performance as investors look to extend trade in MTN’s fundamentally sound stock.”

This is a good step in the right direction for the telecommunications company and investors would do well by having it as part of their portfolio as it has proven to have significant growth potential.

Written by Lawretta Egba.