Wole Olajide
The Premium Board on the Nigerian Exchange is the listing segment for the elite group of companies that meet the most stringent corporate governance and listing standards. The Board is a platform for showcasing companies who are industry leaders in their sectors.
Premium Board features companies that adhere to international best practices on corporate governance and meet NGX’s highest standards of capitalization and liquidity.
A Premium Board listing gives a company access to a global pool of investors who are focused on companies managed in conformity with the highest standards in their target markets.
The Nigerian Exchange introduced the Premium Board in the quest to separate the boys from the men and also to encourage competition amongst them.
However, there are some stocks presently on the main board that can conveniently be on the premium board.
Qualification for admittance of a stock on the Premium Board
Every company that seeks admittance to the Premium Board shall already be listed on the Main Board of The Exchange and such issuer should submit itself for evaluation under The Exchange’s Corporate Governance Rating System (CGRS) and must score a minimum rating of 70%.
Companies on the Premium Board must achieve a market capitalization that is equal to or in excess of N200 billion.
Companies on Premium Board must have a minimum free float requirement of 20% of its issued share capital; or the value of its free float is equal to or above N40 billion
Investment Opportunities
Based on the above listed criteria for admission of stocks on the Premium Board, one can assuredly say that they are fundamentally sound stocks with loads of investment opportunities for short, medium and long term positions.
We have always advised investors to take position in fundamentally sound stocks. One of the safest way is to pitch your tent with stocks on the Premium Board.
Stocks currently on the Premium Board of NGX include: Access Holdings, Dangote Cement, First Bank of Nigeria Holdings, MTN, Seplat, UBA, WAPCO and Zenith Bank.
ACCESS HOLDINGS
With the trading symbol of ACCESSCORP, the financial institution is currently trading at N8.65. In the past 52 weeks, the price has touched a high of N10.45 and a low of N7.5.
It is trading 17.22% away from its 52 weeks high of N10.45. This implies an uptrend potential of about 17%.
The Holding Company has paid an interim dividend of 20 kobo in June 2022. It paid a final dividend of 70 kobo in 2021 year end. We expect growth in the earnings of the financial institution and of course improved dividend payout for 2022 year end. It is likely to 70 kobo as final dividend.
With the Book Value of N29.11, Access Holdings is considered very cheap, relative to its current share price of N8.65.
DANGOTE CEMENT
Dangote Cement Plc has announced that SEC has approved the establishment of a new share buy-back programme which will expire on 12th of December 2023.
The Company declared a final dividend of N20 to its shareholders for 2022 year end. Qualification date is on 30th March 2023.
At the current share price of N288, Dangote Cement has touched a year high of N300 and a low of N220.
Dangote Cement is trading 4% away from its 52 weeks high of N300.
FBN HOLDINGS
The big elephant is currently trading at N10.9 with 52 weeks high of N12.40 and N8.20 as its 52 weeks low price.
FBNH is trading 12.1% away from its 52 weeks high of N12.4 and has the capacity to surpass it as it is trading below its fair value.
The Holding Company paid a final dividend of 35 kobo in 2021 year end. We expect increased dividend payout for 2022 year end.
With the Book Value of N24.89, relative to its current price of N10.90, FBNH is considered very cheap. A position in First Bank of Nigeria Holdings has great growth potentials.
MTN
The telecom giant grew itsturnover by 21.64% to N2.01 trillion for 2022 year from N1.65 trillion reported the previous year.
Profit after tax grew year on year by 20.16% to N358.88 billion from N298.65 billion reported the previous year.
MTN is known for both interim and final dividends and it is a safe haven for dividends seeking investor. The Company declared N10 as final dividend for 2022 year end, and the qualification date is 27 March 2023.
At the current share price of N236, MTN has touched a year of N270 and a low of N185 in the past 52 weeks.
There is uptrend potential of 12.59% for MTN, relative to its 52 weeks high of N270.
SEPLAT
Seplat Energy declared a final dividend of US$0.025 (2.5 Cents) each, and a special dividend of US$0.05 (5 cents), which will be paid to shareholders whose names appear in the Register of Members as at the close of business on 18th April 2023.
At the current share price of N1200, Seplat Energy has touched a high of N1430.5 and a low of N930 in the past 52 weeks.
A position in Seplat has an uptrend potential of 16.11%, relative to its 52 weeks high of N1430.5.
UBA
UBA has paid an interim dividend of 20 kobo to shareholders. The Bank paid a final dividend of 80 kobo in 2021 year end. We expect UBA to increase its dividend payout as growth is anticipated in the 2022 financial year end.
At the share price of N8, UBA is trading 10.11% away from its 52 weeks high of N8.9. The Bank has capacity to surpass its 52 weeks high of N8.9 as it is trading far below its fair value.
Considering its Book Value of N23.64, relative to its share price of N8, UBA is underpriced.
WAPCO
Lafarge Africa, officially trading as WAPCO declared a final dividend of N2 to shareholders whose names are registered in the Register of Members as at the close of business on the 6th April, 2023.
Currently trading at N25.95, the price of WAPCO in the last 52 weeks has touched a high of N33.7 and a low of N20.1.
There is an uptrend potential of 23% relative to its 52 weeks high of N33.7.
ZENITH BANK
The market should expect the audited report of Zenith Bank by the end of March 2023.
Zenith has paid interim dividend of 30 kobo in June 2022. We expect Zenith to pay at least a final dividend of N2.80 or more for 2022 year end.
At the current share price of N24.95, Zenith is trading 7.59% away from its 52 weeks high of N27.
Zenith Bank has the capacity to surpass its 52 weeks high of N27 based on the expectation that Zenith will grow its earnings in FY 2022.
Going by its Book Value of N41.68, relative to its current price of N24.95, Zenith Bank is cheap and embedded with growth potentials.