MTN to sell 575m shares as sustained sell pressure dampens performance

MTN Nigeria Communications Plc (MTN Nigeria) has announced on the floor of the Stock Exchange the intention of the MTN Group to proceed with a public offer for sale of up to 575 million shares in MTN Nigeria by way of a bookbuild to institutional investors and fixed price to retail investors. According to the company, the Offer is the first step in MTN Group’s previously communicated plan to sell down c.14% of its current shareholding in MTN Nigeria. The Offer is expected to open in November 2021 with a bookbuild for institutional investors after which a fixed price should be announced for retail investors in the same month.

Today, the local bourse extended its bearish performance as sell-offs in WAPCO (-1.9%), UBA (-2.4%), and ACCESS (-0.5%) pulled the NGX All-Share Index lower by 8bps to 41,943.83 points. Consequently, the market capitalisation shed ₦16.5bn to ₦21.9tn while YTD return was unchanged at 4.2%. Market activity faltered as volume and value traded declined by 45.1% and 31.6% respectively to 160.9m units and ₦1.4bn. FBNH (19.5m units), LASACO (10.6m units), and TRANSCORP (10.6m units) topped the volume chart while FBNH (₦208.3m), NGXGROUP (₦154.1m), and ZENITHBANK (₦130.5m) led the market by value.

Performance across sectors under our coverage was bearish as 4 indices lost, 1 gained while the AFR-ICT index remained flat. The Oil & Gas index shed 0.6% to lead the laggards, following price depreciation in OANDO (-3.4%) and JAPAULGOLD (-5.0%). Similarly, the Consumer Goods and Banking indices declined 0.6% and 0.5% respectively due to sell pressures on UNILEVER (-8.7%), GUINNESS (-7.3%), UBA (-2.4%) and ACCESS (-0.5%). Losses in WAPCO (-1.9%) dragged the Industrial Goods index lower by 0.1%. On the flip side, the Insurance index gained 1.3% on the back of optimism in AIICO (+4.9%), MANSARD (+3.6%) and LINKASSURE (+7.6%).
 
Investor sentiment, as measured by market breadth (advance/decline ratio), weakened to 0.5x from 0.7x as 13 stocks advanced while 25 stocks declined.  SCOA (+9.5%), LINKASSURE (+7.5%), and OKOMUOIL (+5.2%) led gainers while PHARMDEKO (-10.0%), UNILEVER (-8.7%), and REDSTAREX (-8.2% ) led decliners. In the final trading session of the week, we anticipate that the bears would hold sway in the absence of positive catalysts. 

Market Statistics for Thursday, 4th November 2021