Analysts: NGX Group Listing on Exchange to Bring About Transparency, Price Discovery

Darasimi Adebisi

As the Nigerian Exchange Group (NGX) Group Plc lists its shares on Nigerian Exchange Limited (NGX), capital market analysts have said the listing by introduction aims to create price discovery and bring about transparency.

The NGX Group had announced its intention to list on the Main Board of NGX listing by introduction of 1,964,115,918 ordinary shares of 50kobo each at an indicative price of N17.17 per share of Exchange.

The planned listing follows the successful completion of the demutualisation and restructuring of The Nigerian Stock Exchange and its related operations within NGX Group.

The share of NGX Group is expected to commence trading on NGX following their Listing by Introduction. All regulatory requirements have been fulfilled and the Listing has received the approval of the Securities and Exchange Commission (SEC).

Speaking with THISDAY, the former president of Association of Stockbroking Houses of Nigeria (ASHON), Mr. Emeka Madubuike said the listing of NGX group on the NGX is expected to bring about an exchange of wealth and price discovery.

The NGX Group on the NASD last Thursday closed trading at N14.68 and recorded 52-week high of N30.26 per share.

According to Madubuike: “The NGX is about price discovery better than NASD. We are going to see a lot of activities taking place in that stock of NGX Group going forward. There is a better opportunity for investors to invest in the NGX Group once listed on Exchange.

“The listing will open up the shares for more people to invest. Even as we speak, a lot of investors aside stockbroking firms are already buying the shares on NASD.It is going to give people more leeway to have access to shares of NGX group on the NGX.”

Vice President, Highcap Securities Limited, Mr. David Adnori explained that NGX Group listing on the NGX passed through stringent requirements, which was approved by SEC.

“The listing is a wonderful development and it is expected to boost investors’ confidence once it’s listed. Also, NGX Group has to meet post-listing requirements that listed companies are obliged to meet.

“The listing of NGX group means it will be more transparent, accountable and its corporate governance will now be under the control of the investing public. The value proportion of NGX Group would have increased because it is expected to enhance investors’ confidence,” he said.

In addition, the Managing Director, APT Securities and Funds Ltd., Malam Garba Kurfi expressed optimism that the listing of NGX Group is expected to drive liquidity in the stock market.

Group Chairman of NGX Group, Otunba Abimbola Ogunbanjo in a statement stated that: “The Group expects the Listing to bring significant benefits to its business and its stakeholders.

“NGX Group will enhance its strategic flexibility by creating new financing opportunities and partnership possibilities while diversifying its shareholder base.

“This milestone will open up The Group’s capital to new investors within the Nigerian investing public as well as international institutions thereby reinforcing NGX Group’s presence in international capital markets, and for its current long-term shareholders it will create the possibility to realise value.”

The stockbrokers to the listing of NGX Group are Chapel Hill Denham Securities Limited, and RMB Nigeria Stockbrokers Limited, while the Issuing House(s)/financial adviser(s) are Chapel Hill Denham Advisory Limited, and Rand Merchant Bank Nigeria Limited.