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Tax liabilities, divestment, financial failures put Fidelity, Unilever, Royal Exchange, Dangote on stocks-to-watch list



Tax liabilities, divestment, financial failures put Fidelity, Unilever, Royal Exchange, Dangote on stocks-to-watch list

Fidelity Bank’s tax liability, to Unilever’s divestment, Royal Exchange financial failures and Dangote tax credit are on the list of things investors need to watch out for before heading into the stock market this week.

Fidelity Bank, Unilever Nigeria, Royal Exchange and Dangote made the stocks-to-watch list due to activities that don’t relate to the capital market – and these could positively and negatively impact shareholders’ earnings.

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.

Fidelity Bank

In the first week of this month, the company was dragged in the mud by the Kaduna State Government which accused Fidelity Bank of owing N43.3 million taxes.

The bank has failed to pay tax for over nine years within the state, and this led to the closure of its branches in Kaduna.

Read also: Non-bourse activities push GTCO, Flour Mills, BUA Cement, Airtel Nigeria into stocks-to-watch list this week

This means Fidelity Bank has a liability of N43.3 million in just one state (not factoring other states), excluding future ones, and it would heavily impact on the company’s turnover and liquidity going forward.

Unilever Nigeria

Investors need to know that Unilever Nigeria is selling part of its home and care products by ending of July 2021, and this will reduce the revenue of the company when the segment is transferred to a new owner.

This will further impact the value the company will provide its shareholders as Unilever Nigeria had sold its spread business in 2018.

Royal Exchange

Presently, buying Royal Exchange’s share is investing blindly as it has continued to delay the release of its financial statements for 2020 full year, Q1 2021 and Q2 2021.

This has prevented shareholders and prospective investors from assessing or having a grasp of Royal Exchange’s financial capability or liquidity state.

The company also risk over N9 million fine over the delay, further weakening its financial state.

Dangote Industries

Guess who will not be paying tax worth N309.9 billion anytime soon? Yes, Dangote Industries, which covers the company’s Cement manufacturing, sugar, salt and other production.

The government announced last week that a tax credit was offered to Dangote in exchange for road construction. This will reduce the tax liabilities of the group and improve its liquidity during the term of the agreement.

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