The Nigerian Exchange Limited (NGX) concluded the year 2023 on a positive note, instilling renewed confidence among investors and setting the stage for an optimistic outlook in 2024. The upbeat sentiment is driven by increased investor confidence, recent leadership appointments, and expectations of a vibrant primary market.
The positive momentum observed in the closing days of 2023 has sparked optimism among market operators for a bullish and active primary market in the upcoming year. Key factors contributing to this positive outlook include the appointment of Mr. Temi Popoola as the GMD/CEO designate of the Nigerian Exchange Group Plc (NGX Group) and Mr. Jude Chiemeka as the Acting CEO of NGX.
Market operators anticipate a shift in focus towards the primary equities market in 2024, with expectations of more listings and manufacturers seeking capital after market reforms. The orderly transition in leadership is seen as a positive development that will boost market confidence.
Financial experts share the optimism for a positive market in 2024, despite macroeconomic challenges. The 2024 budget proposal, relying on private capital for funding developmental projects, has instilled confidence. Tajudeen Olayinka, CEO of Wyoming Capital and Partners, anticipates a bullish primary market, emphasizing the role of the private sector in navigating economic challenges.
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The leadership transition at NGX Group Plc and its subsidiary NGX Exchange Limited is viewed positively by financial experts. The appointment of well-trained professional stockbrokers to key positions is seen as a favorable development for the market.
David Adonri, Executive Vice Chairman of Hicap Securities Limited, acknowledges the challenging macroeconomic situation but foresees improvements in 2024. The expected commencement of domestic oil refining and monetary policy focusing on price stability are factors contributing to the positive outlook.
The commodities ecosystem is also expected to be active in 2024, contingent on sustained military action against bandits, terrorists, and insurgents. The appointment of new leadership within NGX is deemed crucial for the continuity and sustenance of development programs.
Shareholders’ Expectations for 2024
Shareholders express expectations for the new year, emphasizing key areas for government attention:
1. Addressing Naira Floating: Shareholders call for government intervention to address the floating of the Naira, which has resulted in foreign exchange losses for companies in the capital market.
2. Conducive Business Environment: Providing a conducive business environment for foreign investors to curb delisting and promote business growth.
3. Insecurity: Addressing issues of insecurity to create a secure and conducive business environment for investors.
4. Inflation Control: Curtailing the rising tide of inflation to promote business growth and reduce the cost of borrowing.
5. Double Taxation: Addressing the issue of double taxation, which has impacted companies’ profitability.
6. Incentives for Companies: Providing more incentives to companies in the capital market, including reduction in import tariffs, tax holidays, access to foreign exchange, adjusted electricity tariff, and lower interest rates.
Shareholders anticipate positive results in the market, expecting improved economic conditions, stability of the exchange rate, and increased inflow of dollars.
The National Co-ordinator of the Independent Shareholders Association of Nigeria (ISAN), Mr. Moses Ibrude, highlights sustained market performance and anticipates increased activities in 2024 due to proposed bank recapitalization and numerous rights issues in the pipeline. He calls on the government to implement business-friendly policies and strategies.
As the NGX Exchange closed 2023 with a significant year-on-year increase, reaching 74,773.77 index points and a market capitalization of N40.92 trillion, investors strategically position themselves to capitalize on favorable policies and record earnings from quoted firms. The positive market sentiment sets the stage for a promising 2024, driven by a combination of leadership stability, policy reforms, and private sector-led initiatives.