BUA Cement, Eterna, Nigerian banks are stocks to watch this week

Going into the Nigerian stock market this week, note that Eterna, BUA Cement and Nigerian banks are the stocks to watch.

This week, the stock market would be trading for four days due to the Democracy Day public holiday scheduled for Monday, June 12, 2023.

Ripples Nigeria stocks watchlist is a selection of stocks monitored for viable trading or investing opportunities. An investor may casually generate a list of equities for investment purposes. But we have taken the pain to do that based on certain parameters in order to save you that hassle.

Kindly note that Ripples Nigeria Stocks Watchlist is not a buy, sell or hold recommendation. It is advisable to consult your financial advisor before making any investment decision.

Eterna Plc

Eterna Plc closed last week’s trading in the Nigerian stock market as the best gainer, increasing shareholders’ investment value by 45.41%

The growth represents N5.47 billion gain within five days of trading, increasing Eterna’s market value from N12.06 billion to N17.54 billion.

Eterna recorded the gain amid President Bola Tinubu’s declaration that oil companies will now be allowed to sell fuel at market reflective price.

Recall that during the week, Ripples Nigeria reported equity investors have been increasing their interest in oil shares.

Despite the surge in demand for oil shares, investors need to trade with caution, as profit takers could cash in on the renewed interest, which might shoot the share price down.

Nigerian banks

Last week, the Banking Index recorded its slowest growth in the last four weeks, appreciating by 5.70 basis points, signalling reduced interest in bank shares in the capital market, amid network providers’ threat to shut down banks’ Unstructured Supplementary Service Data (USSD) platform.

READ ALSO:BUA cement takes on $500m debt burden to compete against Dangote

Top-tier banks in the stock market could record revenue losses in their electronic service, as network providers have warned that banks’ customers’ access to the USSD platform could be blocked.

Nigerian banks, mostly trading in the stock market, owe telecommunications companies N120 billion for the USSD service provided to banks’ customers.

The chairman of the Association of Licensed Telecoms Companies of Nigeria (ALTON), Gbenga Adebayo, said the top banks owe the largest share and have refused to pay.

Due to this, Telcos have sent withdrawal notices to the top tier banks, informing them that failure to pay their debt would cost them the USSD platform and lose the N6.98 kobo they charge on USSD transactions.

BUA Cement

BUA Cement is looking to deepen its competition against its market rival, Dangote Cement, by expanding its cement plants in Kalambaina in Sokoto State.

The Rabiu Abdulsamad cement company has borrowed $500 million to increase the capacity of the firm’s plant to 8.0 MTPA.

BUA Cement also plans to disburse part of the half a billion dollars loan to facilitate the development of other ancillary utilities.

This loan obtained from International Finance Corporation (IFC), African Development Bank (AfDB) and others will increase BUA Cement’s sales and revenue in the long run.

An increase in revenue could positively impact net profit, which will reflect in the dividend paid out to shareholders in the long term.

This expansion plan reveals BUA Cement has future growth prospects, which in turn, could attract investors toward the firm’s shares, boosting the investment value of the shareholders at the same time.

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