Nigeria’s equity boom pushes market value beyond N130trn 

The Nigerian Exchange Limited (NGX) has officially crossed the N130 trillion market capitalisation mark, a milestone that says much about the country’s economic resurgence as it does about growing investor optimism.

Nigeria’s stock market capitalisation as a percentage of GDP has tripled to about 30 percent in two years but remains well below the global average for stock market cap to GDP which often sits at above 60 percent. In neighbouring South Africa, the ratio is over 100 percent of GDP, signalling room for more growth for Nigeria’s market.

The historic peak recorded on March 17 builds on the bullish run that saw the market surpass the N100 trillion mark just two months ago in January. The surge reflects a repricing of Nigerian assets following economic reforms that have pushed investors into equities in search of high returns.

Read also: Nigeria seeks to unlock liquidity from tightly held stocks

The session was characterised by significant buying interest in heavyweight companies, pushing the benchmark index to new heights.

The All-Share Index (ASI) rose by 0.54 percent to close at 202,559.41 points, building on the preceding trading day’s breakthrough past the 200,000-point psychological barrier. The year-to-date (YtD) returns rose to +30.17 percent.

Also, the total value of listed equities settled at approximately N130.025 trillion. Investor engagement was robust, with over 1.751 billion shares exchanged in 62,654 deals, valued at roughly N88.095 billion.

This record milestone reflects deepening market liquidity and growing investor confidence, particularly as the March 31 banking recapitalisation deadline approaches.

Read also: Nigeria Week Ahead: Equities sink, Oil surpasses $100, CPI in focus

Analysts attribute the momentum to strong corporate fundamentals and a steady shift toward local equity investment as a hedge against broader macroeconomic shifts.

“The decisive break above the 200,000-point mark is likely to attract momentum-driven buying as the ASI enters uncharted territory,” Lagos-based Vetiva analysts said ahead of Tuesday trading.

The record rally was largely propelled by the industrial goods sector and financial services, which continue to see heightened activity amid ongoing corporate developments.

Stocks like BUA Cement, Zenith Bank, Premier Paints, Nahco and RT Briscoe were the investors’ delight on Tuesday.

“Given the momentum observed in one of ASI’s heavyweight – BUA Cement, we are looking to increase our weight on the ticker, in a bid to maximise Model Equity Portfolio (MEP) return,” said CardinalStone Research analysts on March 16.

Read also: Stock rally lifts pension equity returns 78% in one year

“To initiate this transaction, we would likely reduce our position in some counters to free up cash. This week, we expect sentiments to be mixed. On one hand, investors may book some profit on tickers that have rallied significantly in the past few weeks.

“On the flip side, investors may be looking to take positions in fundamentally sound names, especially banks that are yet to release FY’25 audited results.

“Other factors that might shape market sentiments include the ongoing geopolitical tension in the Middle East, the spillover effect on the energy market, inflation outlook and currency expectations. On our part, we will continue to make tactical portfolio adjustments to keep positioning optimal,” the analysts added.

Temi Popoola, group managing director/ chief executive officer of Nigerian Exchange Group, described the over N130 trillion capitalisation milestone as a sign of growing confidence in Nigeria’s capital market.

He said, “Nigeria’s ongoing reforms are strengthening domestic capital formation, and the market is responding positively.”
“Increased participation by local investors, improving corporate fundamentals, and continued market modernisation are reinforcing the role of the capital market as a catalyst for long-term wealth creation and sustainable economic growth,” Popoola told BusinessDay.