The stock market didn’t close in favour of businessman, Abdulsamad Rabiu and his company, BUA Cement, on Wednesday, as investors opted for the shares of his market rival, Dangote Cement, owned by Africa’s richest man, Aliko Dangote.
After trading hours, Rabiu lost over N13.48 billion ($32 million), which represents -0.48% of his wealth, resulting to the billionaire’s networth slumping to $6.7 billion, according to Forbes Billionaire Index.
Ripples Nigeria understands that the loss was driven by pessimistic investors holding BUA Cement shares. They engaged in a sell off to take out their investment, mirroring dwindling shareholders’ confidence in the firm’s growth.
Analysis of BUA Cement performance shows the share depreciated by -3.16%, opposing the 0.55% growth the Nigerian stock market posted on Wednesday. Investors exited the company at a cheaper price of N71.9 per share, way below the N74.25kobo it opened the trading market with.
The dip in Rabiu’s firm follows a poor performance in the capital market, which has seen BUA Cement remain stagnant at N74.25kobo per share in over one month, reflecting investors’ disinterest in investing in the firm.
At some point during trading, BUA Cement sold their shares for as low as N66.85kobo per share, before closing the day at N71.9kobo. The dip wiped off N79.58 billion from the firm’s market capitalisation, which crashed to N2.43 trillion, in contrast to previous day’s N2.51 trillion.
As the shareholders of BUA Cement were selling off on the exchange floor, investors were buying that of Dangote Cement, triggering a 1.85% growth in the value of share held by shareholders of Aliko Dangote’s firm.
The increase in demand saw the cost of the share rise to N275, up from N270. This raised the market cap of Dangote Cement to N4.68 trillion, from N4.60 trillion. This was a gain of N85.20 billion, more than the amount BUA Cement lost.
Following the share appreciation, Dangote’s networth rose to N14.1 billion, gaining N74.15 billion ($176 million) after trading.
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