New participant in the Nigerian Exchange Limited trading board, Aradel Holdings, is still struggling to retain its membership of the elite trillion Naira market capitalized stocks five days after getting listed.
The equity was listed on Monday, October 14, 2024 on the main board of the NGX at N702.69 per share but went ahead to close at N772.90 thereby boosting its market capitalization to close N3.358 trillion on the first day entering into the market.
The company’s shares however could not enjoy investors’ patronage throughout the week as sell-off pressure drove the price southward, at the close of trading on Friday, October 18, 2024 it has lost N147.50 or 23.59 percent of its market cap as the share value decline to N625.40 after within five trading days.
Notwithstanding, the stock remains a member of the exclusive club of equities with market capitalization above N1 trillion alongside ten others even as it replaced Oando on the list due sell-off pressure in recent time.
But in dollar terms, only nine out of the eleven companies hold a market capitalization above $1bn (approximately N1.66trn).
Topping the list of companies with the highest market capitalization at the close of the week is Airtel Africa Plc having attained N8.268 trillion market value to overtake Dangote Cement Plc which had a total value of N8.159 trillion.
Other companies that remain in the niche club are BUA Foods Plc with a market cap of N7.108 trillion closely followed by MTN Nigeria Communications Plc, N4.010 trillion, BUA Cement Plc N3.752 trillion, SEPLAT Energy Plc N3.070 trillion; Geregu Power Plc N2.875 trillion, Transcorp Power Plc N2.699 trillion, GTCO Plc N1.471 trillion and Zenith Bank Plc N1.176 trillion.
Further analysis revealed that during the week, investors’ interest in the shares of Transcorp Power and GTCO bolstered their performance as they appreciated by 19.29 percent and 2.04 percent respectively to enhance their capitalization and sustain them in the club.
In terms of sector, the Utilities sector dominated the list with three companies, followed by the Financial Services, ICT, and Industrial Goods sectors with two companies each, while Consumer Goods and Oil and Gas had one.
The following eight companies, half of which are banks, are on the watch list. They show promise of attaining the N1trn market capitalization mark. There are TRANSCOHOT, OANDO, FBNH, UBA, ACCESSCORP, NESTLE, STANBIC, INTBREW.
Analysts remain optimistic about the potential growth in the financial service sector, believing that more companies will join the N1trn gang soon. This promising outlook may inspire investors to take long-term equity positions.
The Nigerian Exchange maintained its positive momentum during the week ended, October 18, 2024 despite macroeconomic headwinds, particularly the release of September’s inflation data, which saw consumer price inflation rise to 32.70 percent.
The increase, largely driven by persistent hikes in the food index that makes up over 51 percent of Nigeria’s inflation basket, did little to dampen market sentiment.
Meanwhile, market analysts say market sentiment is expected to remain positive in the new week as investors anticipate more Q3 earnings reports.
Commenting on the prospect of the market this week, researchers from Cowry Assets Management said, “The market has already reacted favourably to several impressive Q3 releases, providing insight into potential year-end performance. Despite the ongoing market corrections and pullbacks, investors are advised to reposition their portfolios strategically, focusing on sectors and companies with strong growth and earnings prospects.”
Aradel is an integrated energy Company with operations spanning upstream, midstream, downstream, power and renewables.
Its offering comprises a robust portfolio of energy solutions, delivering reliable, clean and sustainable energy sources and driving innovation that traverses the entire value chain.
Its portfolio encompasses exploration, production, refining, and distribution, as it strives to deliver exceptional value and secure the energy needs of communities locally and globally.
The recent listing on NGX offers investors the opportunity to engage with one of Nigeria’s most diversified energy companies, positioning it as a key entity on the Exchange.
As the global energy landscape rapidly evolves, Aradel recognises the importance of embracing the energy transition and is taking proactive steps toward a sustainable future.
One of the central elements of the energy transition is the accelerated deployment of renewable energy sources. Nigeria and several African countries possess abundant renewable energy resources, such as solar, wind, hydro, and geothermal.
Aradel acknowledges that renewable energy sources play a crucial role in achieving a low-carbon future, hence its commitment to investing in renewable energy projects that harness the power of solar, and other sustainable sources.
By diversifying its portfolio, Aradel aims to reduce its carbon footprint while creating opportunities for sustainable economic growth.
Over the past five year (2019 to 2023), the company revenue grew from the 2019 level of N45.958billion to N221.142 billion in 2023.
Also, its profit before tax (PBT) has risen from N20.592 billion in 2019 to N112.163 billion in 2023, while Profit After Tax (PAT) increased from 2019 low of N19.497billion to N53.737billion in 2023.
Basic Earnings Per Share (EPS) which was 89.8kobo in 2019 grew to 247.4 kobo in 2023.
