Nigerian Stock Exchange Targets $1tn Market Capitalization

LAGOS – The Nigerian Stock Exchange (NSE) plans to raise its market capitalization to $1 trillion by 2016.

According to a report made available to Biztellers, the NSE’s Head of Strategy, Ms Yvonne Emordi, made the disclosure over the weekend at a business clinic of the Financial Services Group of the Lagos Chamber of Commerce and Industry (LCCI).

She added that the Nigerian bourse has successfully raised about $100 billion out of the target.

Nigerian Stock ExchangeSpeaking on effort at reviving local investor confidence in the Exchange since the 2008 crash, she said: “We have focused very much on the regulatory framework as well as enforcement. We have come out with new products to boost investors’ confidence.”
Emordi stated that the NSE is third largest exchange in Africa by market capitalization with an approximate of 5 million investors both local and foreign holding 57.3 per cent and 42.7 per cent market activity respectively, adding that local investors are returning into the market.

“This is a welcome development because it would go a long way in mitigating the risk of external shock. Foreign investments are typically known for moving the market because they are always looking for deals and profit. The combination of all these would bring about positive impact to the economy at large,” she added.

She noted that in restoring market confidence, there had been interactions with operators, investors and stakeholders to restore confidence, facilitating the International Financial Reporting Standard (IFRS) adoption in Nigeria and market operators required to maintain an annual fidelity bond with a January to December validity.

According to her, the outlook for 2013 in Nigeria is a projected national growth of 7.6 per cent by the Nigeria Bureau of Statistics (NBS), falling inflation expected as a result of government policy on fuel subsidy and a positive government initiative to increase power generation, financial inclusion, agricultural transformation and strengthening fiscal discipline.

Also speaking at the event, the Portfolio Manager, Stanbic IBTC Asset Management, Mr. Jide Alo, said that the first quarter 2013 numbers by banks would play a major role and signal trajectory for 2013. Alo said current market update reveals that industrial goods sector is leading the market with a return of 30.82 per cent followed by the oil and gas sector which returned 21.11 per cent as at April 2013.

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