Shareholders in the nation’s capital market have expressed displeasure over consistent fall in share prices of quoted companies despite improved scorecards and low stock prices.

The investors who are still counting their losses urged the Federal government to address all constraints impeding the growth of the market to boost investors’ confidence and achieve sustainable recovery this year.

According to them, the constraints range from inconsistent macro-economic policies and regulatory environments, lack of transparency in economic management, multiple taxation, among others.
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The investors decried that more listed companies are currently hitting 10-year lows, contrary to expectations that the 2021 earnings and dividend declarations churned out by quoted companies would trigger share price appreciation in the market especially for stocks that have ‘bottomed out’.

Already, they have linked the downturn to rising insecurity, weak economy, uncoordinated fiscal and monetary policies that had kept many foreign and domestic investors on the sideline.

In addition, the stakeholders also bemoaned the rising delisting of firms, especially the 27 companies that were forcefully delisted from the Nigerian Exchange Limited (NGX) between 2016 and 2021 in new data from the Exchange.

Specifically, an Independent investor, Amaechi Egbo suggested that the government should develop more focused strategies that will economically empower indigenous firms and multinationals and ultimately stimulate their interests in investments.

According to him, the government must tackle all these hindrances to provide an enabling environment, attract more retail participation and increase market confidence.

He insisted that the government must be committed to creating an enabling environment for long-term growth of the capital market.

“Government must show concern on certain fiscal and legal policy constraints to operations in the market and ensure that it addresses these concerns decisively,” she said.

Egbo noted that this would enable the exchange to become more attractive to investors seeking higher returns, safety and liquidity for their portfolios.

Furthermore, he argued that the continued decline in shares despite attractive prices showed that the Nigerian economy is in dire need of an urgent stimulus that would revive the economy and bolster the capital market.

Egbo further stated that while the market capitalisation of the NGX is currently upbeat due to price appreciation from a few companies dominating the market, especially the telecoms firms, other stocks have consistently recorded price depreciation.
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President of Issuers and Investors Alternative Dispute Resolution Initiative (IIDRI) Moses Igbrude harped on the need for some taxes on capital market activities to be reduced or removed completely.

“We have in the past advocated a downward review of withholding tax and the abolition of certain other taxes on capital market transactions hoping that a tax revenue foregone through lowered tax rates would lead to more savings.

“Not only increase in savings, it would also lead to higher employment and growth in GDP, resulting ultimately in the expansion of the national tax base,” he said.

He added that reduction of some taxes on capital market activities and the abolition of others would enhance investment in the country.

He also accused the government of handling issues of the capital market with levity, noting that without a vibrant capital market, long-term capital formation critically required for the creation of domestic wealth and generation of productive employment would continue to elude the economy.
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