The Nigerian Exchange Limited (NGX) recorded N12.17 trillion worth of both FGN bonds and corporate listings in 2024.
Data obtained from the NGX revealed that corporate listings outpaced FGN bonds on the NGX in 2024 as the federal government leveraged the capital market to raise funds locally.
FGN bonds, issued by the Debt Management Office (DMO) on behalf of the federal government, were a key part of the listings. In 2024, an estimated N5.95 trillion worth of FGN bonds was listed on NGX. Meanwhile, corporate listings, including corporate bonds and memorandum listings, accounted for N6.2 trillion.
The largest FGN bond listings in 2024 included 873,527,020 units of 18.50 percent FGN Feb 2031 valued at N873.53 billion, and 621,382,074 units of 19 percent FGN Feb 2034 worth N621.38 billion.
Additionally, a supplementary listing of 282,625,193 units of 18.50 percent FGN FEB 2031 was recorded, valued at N282.63 billion.
Read also: NGX Group CEO charts Pan-African market vision at Ethiopian Securities Exchange launch
Increased participation in the FGN bond market by Pension Fund Administrators (PFAs) was evident during the year, as high inflation continued to erode returns in other investment segments of the capital market.
Who is behind corporate listings?
On the corporate side, Sovereign Trust Insurance Plc opened the year with a January listing of N1.43 billion from its rights issue of 2,841,116,504 ordinary shares at 50 kobo per share on a 1-for-4 basis. Ellah Lakes Plc followed with a N2.19 billion listing, while Chapel Hill Denham Management Limited listed N11.58 billion.
In March, Transcorp Power Plc made a significant impact with a listing of N1.8 trillion through 7.5 billion ordinary shares at N240.00 per share, boosting market liquidity.
April saw Emerging Africa Asset Management Limited list N5.55 billion, while VFD Group Plc listed N12.5 billion following its rights issue of 63,342,455 ordinary shares at N197.33 per share on a 1-for-3 basis. Royal Exchange Plc added N1.56 billion to the market in the same month.
Other notable listings in 2024 included AVA Global Asset Managers Limited, which listed N4.08 billion worth of shares, and Cadbury Nigeria Plc, with a listing of N7.04 billion in May.
In June, Multi-Trex Integrated Foods Plc added N2.5 billion to the Exchange. July saw Tantalizers Plc list N1.07 billion, with Wema Bank Plc raising N39.95 billion in the market.
Notore Chemical Industries Plc contributed N105.79 billion. In August, International Breweries Plc listed N516.22 billion via a rights issue, while Japaul Gold Ventures Plc raised N20 billion through a private placement.
October featured significant listings, with C & I Leasing Plc raising N822.92 million via debt-to-equity conversion.
While Aradel Holdings Plc had a massive N3.05 trillion by introduction, Nigerian Breweries Plc raised N548.73 billion through a rights issue.
Read also: Oil & gas tops 2024 best performing sectors in NGX
Why FGN bonds?
Analysts attribute the strong demand for FGN Bonds to attractive yields. FGN bonds offered investors high returns on their investments.
According to analysts, the oversubscription levels of the bonds highlighted confidence in the federal government’s ability to meet its debt obligations.
The appetite for FGN bonds reflects a preference among PFAs and other investors for low-volatility instruments that guarantee capital returns, even with relatively lower yields.
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