Barely a day after MTN Nigeria was announced as the new most capitalised company on the Nigerian Stock Exchange (NSE), its stock reversed gains to see former “defending champion” Dangote Cement assumes once again market leader by capitalisation.
Bargain hunters, who took advantage of an imminent official inclusion of MTN on the MSCI index that saw sustained bullish run of Nigeria’s biggest foreign direct investment (FDI) stocks sold off on perceive most preferable exist price.
Due to sell offs witnessed during trading that saw the Nigerian All Share Index (ASI) shed by 0.22 percent in value on Tuesday, MTN stocks slumped 4.4 percent to N132.60 from a previous close of N138.70 at the end of trading.
This saw the telco giant’s lose in market value N124.135 billion to settle at N2.699 trillion, relinquishing the recently assumed most capitalised firm on the Exchange to formal title holder, Dangote.
Dangote cement, Nigeria’s biggest cement producer on the other hand maintained a 3-day bullish run gaining 1.23 percent, 0.30 percent and 0.91 percent respectively to outperform the Telco giant by a market value of N130 billion to settle at N2.829 trillion at the close of trading on Tuesday.
“It is an interesting race to watch out for,” Gbolahan Ologunro, analyst at CSL stockbrokers told Businessday. This race isn’t likely to end soon as both companies’ performances would be driven by strong fundamental and perceived growth prospects.
Although the end of trading on Wednesday saw investors push up by 2.56 percent MTN market value to N2.707 trillion against N2.699 trillion it settled at the previous day, gains were not sufficient enough to displace the cement giant as the most capitalised firm on the exchange.
Dangote cement on the other hand remained flat after a 3-day gain streak at N166 with a market cap of N2.829 trillion according to data obtained from the Bloomberg terminal.
MTN, being a technology driven company while Dangote Cement, a potential solution to Nigeria’s housing and infrastructure deficits amid rising population still hold potential for growth in earnings, hence strong fundamentals.
Current market rout fuelled by general negative sentiments of investors however remains a critical force weighing down performance of bellwethers in the market, forcing low prices and year returns to investors.
