Focus shifts to Q3 scorecards as sell pressure persists

Despite the negative start to this week’s trading, investors in Nigeria’s equities market are still expected to cherry-pick attractive stocks priced at new lows.

After the waned half-year (H1) earnings season ushered in the bears on the Nigerian Exchange, stock buyers focus has now shifted to the third-quarter (Q3) financials results of listed companies expected to be released on the Bourse next month –hopefully the result will serve as a positive trigger.

Already, some companies have started notifying the investing public of their closed period –which is the time between the completion of their financial results and the announcing of these results to the public.

In compliance with the post-listing rules of the Nigerian Exchange Limited, LivingTrust Mortgage Bank Plc has issued notice of the commencement of Closed Period and Board of Directors meeting.

The Mortgage bank in a recent notice signed by Timothy Gbadeyan, its Company Secretary notified the Nigerian Exchange Limited and members of the public, particularly its shareholders that a Board of Directors meeting has been scheduled to hold on October 15, 2021. The meeting, it said will discuss amongst other items, the company’s unaudited financial statement for the quarter ended September 30, 2021.

Shareholders of the mortgage bank and other relevant insiders were also notified that the bank will commence a closed period from September 30, 2021, being the end of the quarterly financial period in review, to end 24 hours after the quarter-three, 2021 unaudited financial statement has been released to the public, after which the trading period will be resumed.

Other companies that have issued notices of their closed period are: Fidelity Bank Plc, Nigerian Breweries Plc and Guinness Nigeria Plc.

During the closed period, insiders are prohibited from trading the company shares or making any relevant information public before it is officially announced. During this period, insiders and /or person(s) connected to them and such other interested parties who have regular access to their financial information or other sensitive information which may materially affect the price of the companies’ securities are expected to observe the earnings-related closed trading period by not buying or selling the shares.

Fidelity Bank Plc notified the NGX Regulation Limited (NGX RegCo), the shareholders and the general public that the Bank’s board meeting holds on October 26 to consider and approve the audited financial statements of the bank for the third quarter ended September 30, 2021.

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“Premised on the foregoing, the trading window for dealing in the bank’s shares shall be closed to its shareholders and their connected persons from October 1, 2021 until 24 hours after the release of the bank’s unaudited financial statements for the third quarter ending September 30 on the floor of the Nigerian Exchange Limited,” Fidelity Bank said in a notice at the Nigerian Exchange Limited (NGX) signed by the bank’s secretary, Ezinwa Unuigboje.

The Nigerian Exchange Limited (NGX) All-Share Index (ASI) and Market Capitalisation had appreciated to 38,962.28 points and N20.299trillion respectively in week ended Friday September 24 from week-open lows of 38,943.87 points and N20.290 trillion.

In their outlook for the week, Lagos-based GTI Research analysts said they expect positive sentiment “as expectation increases towards the compilation of third-quarter (Q3) financial reports. Furthermore, investors will also track yield movement in the fixed income (FI) market”.

In the trading ended Friday September 24, Nigeria’s stock market closed in green (+0.05percent) as investors routed for last minute bargain in favour of value counters that are trading at new lows.

“Looking ahead, we expect the market to remain in a lull, with occasional bargain hunting until 9M-2021 results are released,” research analysts at Lagos-based United Capital said in their recent investment view for the week to October 1.

Though, the NGX 30 index which tracks the top 30 companies in terms of market capitalisation and liquidity decreased by 0.04percent, performance of other key sectoral indices in the review week showed: NGX Banking (-0.43percent), NGX Consumer Goods (-0.04percent), NGX Industrial (+0.23percent), NGX Insurance (+1.75percent), NGX Oil & Gas (+1.38percent), and NGX Pension (-0.05percent).

“Although the market advanced marginally last week, the sentiment in the market was mixed, as the market lost on the first 3 days of the week. In the debt market last week, the Federal Government raised a total of $4billion from Eurobond issuance as robust participation was witnessed on instruments offered.

“We however do not expect this to influence demand for equities this week, especially as bond yields in the Naira market have moved slightly downwards recently,” according to Meristem Research analysts in their September 27 note to investors.

While Meristem notes that prices are currently attractive, but in the absence of significant positive triggers to drive buying interests, they expect the market to close the week in the red.

Nigerian Breweries Plc through its Company Secretary, Uaboi G. Agbebaku also notified the Nigerian Exchange Limited and the investing public that a meeting of the Board of Directors of the brewer has been scheduled for Thursday, 28th October, 2021.

“An item on the agenda for the meeting is the consideration and approval of the Unaudited Financial Statements of the Company for the third quarter (nine months) ending 30th September, 2021. Further, please be informed that the Company’s Closed Period will commence on Tuesday, 28th September, 2021 and will continue until the next day after the said Unaudited Financial Statements are submitted to The NGX,” Nigerian Breweries Plc said.

Guinness Nigeria Plc in its notice at the Exchange signed by Rotimi Odusola, Company Secretary/Corporate Affairs Director also notified the brewer’s shareholders, Nigerian Exchange Limited (NGX) and the investing public that a meeting of the Board of Directors of the Company will hold on Tuesday October 19, 2021 for the purpose of considering and approving the financial results for the quarter ending September 30, 2021, amongst other matters.

“Accordingly, in compliance with the NGX Rules on Closed Period (as amended), the closed period for trading in the Company’s shares by insiders will commence on September 30, 2021 and will expire 24 hours after the announcement of the results.

“Therefore, no Director, person discharging managerial responsibility, employees with sensitive information and other insiders of the Company and their connected persons may directly or indirectly deal in the securities of the Company during the closed period. The results for the period as approved by the Board will thereafter be uploaded to the Exchange portal not later than October 20, 2021”, Guinness Nigeria Plc.