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Nigerian Stock Market Wraps 2023 With A Stellar N13trn Investor Gain
In 2023, President Bola Tinubu’s reforms spurred a remarkable surge in the Nigerian stock market, with investors witnessing a staggering N13 trillion increase in returns.
Tinubu’s strategic policies, including the removal of fuel subsidies and the streamlining of foreign exchange rates, instilled robust confidence among investors, driving significant growth in fundamental stocks.
Despite facing double-digit inflation, the market’s capitalization closed the year at N40.918 trillion, a striking 46.6% leap from its 2022 closure at N27.91 trillion.
As a result, the Nigerian Exchange Limited All-Share Index (NGX ASI) soared to an unprecedented high of 74,773.77 basis points, marking an impressive Year-to-Date gain of 45.90% from its opening at 51,251.06 basis points for trading.
The addition of new listings significantly influenced the record-breaking trajectory of the NGX ASI, sustaining the stock market’s upward momentum.
Companies like MeCure Industries Plc, VFD Group, Nigeria Infrastructure Debt Fund (NIDF), and Africa Plus Partners notably contributed to the positive trajectory observed in the period.
In 2023, significant stock market indices responded to the market’s trend, influenced by the wide-reaching reforms impacting various sectors within the Exchange.
Specifically, the NGX Banking Index surged by 114.90% to reach 897.20 basis points, while the NGX Oil & Gas Index saw a robust increase of 125.54% to hit 1,043.06 basis points.
Additionally, the NGX Industrial Goods Index experienced a growth of 12.86% to reach 2,712.27 basis points.
Commenting on the 2023 stock market performance, Mr. Tajudeen Olayinka, the Chief Executive Officer of Wyoming Capital and Partners, remarked, “The market in 2023 was notably eventful and bullish.”
He said “We saw a market that picked its 2023 position way back in November 2022, when it was obvious that the three leading presidential candidates, namely: Asiwaju Bola Tinubu, Peter Obi and Alhaji Atiku Abubakar, that could succeed former President Muhammadu Buhari, were pro-market.
“And so, the build-up to the bullish run in 2023, that started in November 2022, was a demonstration of market confidence in a private sector-centric president.
“The inaugural speech of President Tinubu, with respect to fuel subsidy removal and exchange rate unification, eventually activated the market-wide pent-up confidence that had always been there but eluded the market ever since.
This market-wide confidence remained throughout the year.” he added
Mr. Tajudeen Olayinka expressed optimism for the Nigerian stock market in 2024, foreseeing a continuation of positive momentum.
Olayinka further stated “And we can draw that from 2024 budget proposal of President Tinubu, where total reliance has been placed on the use of private capital in funding some important developmental projects across the country.
“In a way, we are going to see more public companies get listed on the stock exchange for the purpose of raising new capital, while the existing listed companies will not be left behind in this development.
“So, I see a very bullish and active primary market in 2024, even though, there could be occasional moderation in price movement across the board, as investors take profit and engage in portfolio rebalancing.
“The fact that private sector will take the lead in navigating the economy out of its prolonged state of disequilibrium, we will see a better capital market in 2024.”
Managing Director of ARM Securities Limited, Rotimi Olubi, highlighted that in 2023, the Nigerian stock market demonstrated resilience amid challenges such as global agencies’ downgrades (FTSE and MSCI) and macroeconomic hurdles like persistent inflation, high-interest rates, and foreign exchange losses.
He said “Despite all these, the Nigerian equities market proved to stand strong, hitting historic highs with the NGX All Share Index reaching an unprecedented 70,000 points and achieving an impressive 45.90per cent YtD return, culminating at 74,773.77 basis points by year-end.
“Reforms, notably FX liberalisation and the removal of petrol subsidies, spurred investor optimism, resulting in substantial gains, particularly in the Banking and Oil and Gas sectors. Furthermore, impressive earnings in the face of inflationary pressures and FX losses further boosted investor confidence, contributing to the remarkable market returns,” Olubi added.
Meanwhile, Nigeria’s external reserves plummeted to a six-year low of $32.87 billion by December’s end, as data indicated. The Central Bank of Nigeria (CBN) intervened by selling dollars in an attempt to stabilize the declining naira currency.
A combination of unresolved forwards, unfulfilled assurances of dollar inflows, and a twenty-year high in inflation led to a turbulent period for the naira.
As a result, the currency devalued by over 50%, making it the third worst-performing global currency in 2023. Kyle Chapman, an FX markets analyst at London-based Ballinger & Co, highlighted these challenges.
To support the naira, the CBN depleted its foreign exchange reserves, which had peaked at $47.63 billion in June 2018. By December, the country’s dollar reserves dwindled to a level last recorded in September 2017, standing at $32.16 billion.
Chapman said “The naira’s downwards momentum is likely to continue through much of 2024, and its ultimate trajectory will depend on whether the CBN’s rhetoric transforms into concrete policy moves that drive up the flow of U.S dollars into Nigeria and shore up trust in the official market.”
Nigerian comedian and popular skit maker, Chibuike Josh Alfred, known by his stage name Josh2Funny, has shed light on the profitability of the content-creating industry.
In a recent interview with Echo Room, Josh2Funny highlighted the impressive financial potential that content creators can achieve, noting that it is possible for them to comfortably afford multiple luxury cars, including up to four Lamborghini vehicles.
Speaking candidly, Josh2Funny emphasised that content creation has become an extremely lucrative field due to the constant demand for fresh and engaging material. “If you want to buy four Lamborghini from content creation, you can buy it,” he said.
His remarks underscore the significant revenue opportunities available in the digital content landscape.
Josh2Funny explained that the continuous consumption of online content is what drives its profitability. “What do you think we are doing in the content-creating industry? Are we joking? You all are with your phones, when you’re in the bathroom, when you’re [using the restroom], you’re consuming our stuff. It’s like pure water,” he stated.
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The comedian further elaborated that businesses or industries that deliver products consumed on a daily basis often see the most substantial financial returns. Content creation, with its high rate of daily consumption by audiences worldwide, aligns perfectly with this model.
“People are out there, consuming our content every time,” he said, reinforcing the idea that the reach and influence of content creators have never been more extensive.
Josh2Funny’s insights reveal why the content-creating industry has become a lucrative career path for many in Nigeria and around the world. With the continuous growth of social media platforms and the public’s insatiable appetite for entertainment and relatable content, creators are finding new and innovative ways to monetize their craft.
This shift not only highlights the potential for significant financial gain but also showcases the evolving landscape of digital media, where influencers, comedians, and skit makers can turn creativity into a sustainable and highly rewarding business.
A safety alert notification by the National Agency for Food and Drug Administration and Control (NAFDAC) in Nigeria issued on October 31, 2024, regarding NIVEA BLACK & WHITE Invisible Roll-on deodorant (50 ml) batch number 93529610, in relation to the general European Union (EU) Rapid Alert System for Dangerous Non-Food Products (RAPEX), has come to our attention.
The batch is said to contain 2-(4-tert-Butylbenzyl propionaldehyde (BMHCA).
In a statement on Saturday, in Lagos, Beiersdorf, the owner of NIVEA brand, assured that the “the Batch No. 93529610 in question has not been marketed in Nigeria and thus never recalled”.
According to the statement, Beiersdorf was well informed that “Based on current European legislation, the use of ingredient 2-(4-tert-Butylbenzyl propionaldehyde (LilialTM) in cosmetic products has been banned from the European markets as of March 1, 2022.”
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It acknowledged that “The batch in question, in fact, expired in January 2022 and was hence at the time fully compliant with the then valid European cosmetic regulation.
“As a responsible corporate citizen, Beiersdorf is working collaboratively with NAFDAC to safeguard the interest of the Nigerian consumers by ensuring that our locally manufactured product meets the global quality standards.”
It maintained that “The safety of our consumers remains our highest priority, consistent with our ethical philosophy as a business.”
In pursuit of this commitment, Beiersdorf’s entire NIVEA product portfolio formulations have been reformulated to be Lilial-free formulas in full compliance with the EU Regulation on cosmetic products well ahead of its Lilial ban coming into effect as far back as March 1, 2022. For instance, the formulation of NIVEA BLACK & WHITE Invisible Roll-on deodorant has been Lilial-free since at least 2020 across the globe, including Nigeria.
“Our trade partners were informed ahead of time and reminded of their responsibility to remove the outdated Lilial-containing products within the legal timeframe to fulfill their obligations with the European Cosmetic Product Regulation,” it added.
The Shell companies in Nigeria teamed up with the Nigerian National Petroleum Company Limited (NNPC Ltd) and other stakeholders to build Information Communication Technology (ICT) centres and a digital library in Nigerian universities in 2024.
Biztellers reports that it initiative is part of their continuing support for education.
Some of the corporate bodies that executed the projects include the Shell Nigeria Exploration Production Company Limited (SNEPCo) and NNPC Ltd, and the Nigerian Content Monitoring and Development Board (NCDMB).
The benefiting institutions were, the Niger Delta University, Amassoma, Bayelsa State, which got a digital library in April, the Sa’adu Zungur University (formerly Bauchi State University), Gadau in Bauchi State, where an ICT Centre was commissioned in July, by The Shell Petroleum Development Company of Nigeria Ltd (SPDC) as part of the Joint Venture with NNPC, TotalEnergies and NAOC.
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In what would sound like singing-off on the educational intervention initiative for 2024, the Federal University of Technology, Owerri (FUTO), overflew with joy at the unveil of a world-class engineering design studios and ICT hub, courtesy of the SPDC, NNPC Ltd and other Joint Venture partners collaborated with NCDMB.
Reflecting on the three facilities, Country Chair, Shell Companies in Nigeria, and Managing Director, SPDC, Osagie Okunbor, said, “This is Shell working to power lives in Nigeria. The projects have changed the academic and physical landscapes in the three universities and linked the students and lecturers to the global learning arena.”
The facilities at FUTO include two state-of-the-art engineering design studios and a fully furnished 100-seater ICT lecture hall, equipped with computers and smartboards with dedicated power and water supplies. FUTO was selected for the project as part of the “institutional strengthening” in the catchment area of SPDC’s Assa North Ohaji South Gas Development Project. They were launched at a colourful ceremony attended by representatives of the Imo State Government and principal officers of the university.
Imo State Governor, Hope Uzodinma, represented by the Commissioner for Digital Economy and E-Government, Dr. Chimezie Amadi, said, “We deeply appreciate the efforts of our partners in NNPC, SPDC, Total Energies, and NAOC JV, who have invested in the future of Imo State by supporting this critical project. Your commitment to human capacity building aligns perfectly with our goals, and together, we will continue to drive innovation, skills development, and sustainable economic growth for our people.”
Okunbor’s address at the commissioning was read by General Manager, External Relations, Igo Weli, in which he expressed happiness “that the collaboration of SPDC, Joint venture partners, NCDMB, and FUTO has resulted in this successful social investment project that demonstrates our commitment to improving access to quality education for every Nigerian.”
On his part, the Executive Secretary NCDMB, Engr. Felix Omatsola Ogbe, called on Nigerian institutions to domesticate the advancements in AI and other technologies.
“Our AI must understand Igbo, Hausa, Efik, Yoruba, and other local languages,” he said, speaking through Dr. Ama Ikuru, the Director in charge of Capacity Building.
“We must leapfrog the innovations of other nations and become a net exporter of advanced technology to achieve the lofty ideals of Nigerian content development,” he added.
The Chief Upstream Investment Officer, NNPC Upstream Investment Management Services, Bala Wunti, said in his address which was read by the Senior Advisor Stakeholders Relations, Halimat Wilson, “Innovation thrives in an environment where ideas can be freely exchanged and developed. The Engineering Studio and ICT Hub is designed to be such a place where students, researchers, and faculty can collaborate on projects, share knowledge, and push the boundaries of what is possible.
Welcoming guests earlier, FUTO Vice Chancellor, Prof Nnenna Oti, thanked the sponsors of the project “for a landmark donation” to the university.
The Shell Companies in Nigeria have been education since the 1950s through scholarships and other initiatives. These efforts have resulted in the award of thousands of secondary, undergraduate and postgraduate scholarship awards, provision of educational infrastructure and establishment of sabbatical and internship programmes as well as centres of excellence in several universities.
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