The Nigerian Exchange Limited (NGX) wrapped up 2023 on a positive note, driven by renewed investor confidence in listed companies. This has sparked anticipation among market operators for a bullish and active primary market in 2024.
Recent leadership changes at the Nigerian Exchange Group Plc (NGX Group), with Mr. Temi Popoola appointed as the GMD/CEO designate and Mr. Jude Chiemeka as the Acting CEO of NGX, effective January 1, 2024, pending regulatory approval, further boost this optimism.
Insiders predict a shift to the forefront of the equity market in 2024, as manufacturers affected by market reforms are expected to tap into the Capital Market for funds. The market is also anticipated to witness an influx of newly public companies seeking to raise fresh capital.
Financial expert Tajudeen Olayinka, CEO of Wyoming Capital and Partners, foresees a positive year for the Nigerian stock market in 2024. He draws confidence from President Bola Ahmed Tinubu’s 2024 budget proposal, emphasizing private capital for crucial developmental projects nationwide.
Olayinka envisions a robust primary market in 2024, acknowledging potential occasional price moderation as investors engage in profit-taking and portfolio rebalancing. He underscores the private sector’s pivotal role in steering the economy, foreseeing a better capital market in the coming year.
Hicap Securities Limited’s Executive Vice Chairman, Mr. David Adonri, highlights the challenging macroeconomic landscape, marked by escalating inflation and a lower-than-expected GDP growth rate. Adonri anticipates economic improvement in 2024, particularly with the domestic refining of crude oil expected to impact forex and petroleum product prices positively.
Adonri emphasizes that if the Central Bank of Nigeria (CBN) enacts a policy of bank recapitalization in 2023, the primary market for equities may take center stage in 2024, offering a lifeline to manufacturers affected by market reforms.
The Commodities ecosystem is also poised for activity in 2024, contingent on sustained military action against bandits, terrorists, and insurgents.
The appointment of new leadership at NGX is viewed positively for the market’s continuity and development. Temi Popoola and Jude Chiamaka, the incoming GCEO and CEO, are seen as experienced professionals capable of taking the market to new heights.
Shareholders, represented by Mr. Patrick Ajudua, President of the New Dimension Shareholders Association, outline key expectations for 2024:
- Address the floating of the Naira to mitigate foreign exchange losses for companies.
- Provide a conducive business environment for foreign investors to curb delistings.
- Tackle insecurity to create a secure and favourable business climate.
- Curtail inflation, currently at 28.2% in November 2023.
- Resolve the issue of double taxation affecting companies’ profitability.
- Introduce incentives like reduced import tariffs, tax holidays, and lower interest rates.
Ajudua anticipates positive results if these expectations are met, fostering confidence among investors and potentially attracting foreign investors back to the market.
Moses Ibrude, National Co-ordinator of the Independent Shareholders Association of Nigeria (ISAN), expects the market’s sustained performance in 2024. He emphasizes the need for favorable business policies and strategies, urging the new leadership to prioritize good corporate governance.
In summary, the NGX Exchange’s remarkable year-on-year increase of 45.90%, closing at 74,773.77 index points, and a market capitalization uptick to N40.92 trillion reflect a positive market sentiment. Investors remain strategically positioned, capitalizing on favorable policies implemented by President Bola Tinubu’s administration, including the removal of fuel subsidies, exchange rate rationalization, and the floating of the Naira.
