Shares of cement producing giant, Dangote Cement Plc sustained foothold on the capital market, dominating other bluechips on the gainers’ chart. The stock, which hit new 52 week high yesterday, gained 9.99 per cent to close at N592.6, hitting N10.095 trillion market cap and becoming the first Nigerian company to reach the mark.
The historic milestone buoyed transactions on the exchange yesterday, as the over all market capitalisation gained N673 billion to close at N52.408 trillion while the all-share index (ASI) rose by 1,230 points, representing a gain of 1.3 per cent to close at 95,768.12 points.
Dangote Cement led 23 others with N59.80 kobo or 9.99 per cent appreciation to close at N592.60 kobo per share while it gained 9.98 per cent to close at N538.80 kobo at the close of transactions last week Friday.
The sudden rise in share price may, however be attributed to businessman, Femi Otedola moves to purchase some shares in the blue chip company and subsequent reports on what motivated his interest in the stock.
According to Otedola, his sudden appetite on the stock was due to Dangote Cement’s outstanding records of consistent and improved dividend payout and sustained profitability over the years as the largest producer of cement in sub saharan Africa.
“Dangote Cement’s export capabilities and extensive operations across Sub-Saharan Africa are essential for regional economic integration and growth. My investment is a testament to my confidence in its potential to propel Nigeria’s and Africa’s industrial and economic development.
“In my investment decisions, I focus on long-term wealth preservation and ensuring shareholders are the ultimate beneficiaries of a company’s success. Companies like Dangote Cement, which consistently deliver value to their shareholders, are fundamental for sustainable economic growth. My investment reflects my belief in its capacity to continue providing significant returns and my commitment to businesses that prioritise their shareholders.
“Dangote Cement’s strong corporate governance and impressive ESG compliance track record make it an ideal investment choice. It represents the type of company that not only contributes to Nigeria’s industrial strength but also aligns with my vision for ethical and sustainable business practices,” Otedola said.
Otedola’s sudden interest in Dangote Cement is currently stimulating other investors appetite in the stock, considering that the business mogul is a seasoned business man who had been able to create value through similar investment in the past.
Head Equity, Planet Capital, Dr Paul Uzum said:” Otedola bought some Dangote Cement, not so much though, so other investors think it will be another case like Transcorp.”
Vice President of Highcap Securities, David Adonri, said: “What is pushing the stock is market hearsay due to publication that Otedola wants to buy into Dangote Cement.” However, he added that the details of the investment and acquisition is still not clear at the moment.
Meanwhile, 24 stocks gained yesterday relative to 47 losers. SUNU Assurance recorded the highest price gain of 10 per cent to close at N1.98, per share. Dangote Cement followed with a gain of 9.99 per cent to close at N592.60, while Tripple Gee & Company rose by 9.81 per cent to close at N2.35, per share.
Eterna rose by 9.80 per cent to close at N25.20, while Meyer and Cutix appreciated by 8.89 per cent to close at N2.94, per share. On the other hand, Cadbury Nigeria, Flour Mills of Nigeria, McNichols, Sovereign Trust Insurance and University Press led the losers’ chart by 10 per cent each to close at N26.10, N42.30, N1.62, 54 kobo and N3.60 respectively, per share.
Jaiz Bank followed with a decline of 9.86 per cent to close at N3.11, while Wema Bank lost 9.58 per cent to close at N10.85, per share.The total volume traded decreased by 4.92 per cent to 721.814 million units, valued at N14.408 billion, and exchanged in 15,757 deals. Transactions in the shares of Transnational Corporation (Transcorp) topped the activity chart with 66.521 million shares valued at N1.232 billion.
Veritas Kapital Assurance followed with 47.004 million shares worth N34.906 million, while Access Holdings traded 40.01 million shares valued at N1.171 billion.
Universal Insurance traded 38.876 million shares valued at N19.198 million, while Japaul Gold & Ventures sold 32.824 million shares worth N84.643 million.
Analysts at United Capital Plc said: “in January 2024, we expect the Bulls to prevail, as bargain hunting continues as the order of the day. Given the global developments across major central banks in advanced economies, high base expectations for inflation, and improved economic growth prospects, we expect the local bourse to record a positive performance this new week. Investors may continue to cherry-pick stocks with strong fundamentals, (value or growth).
“However, value stocks may be choice for dividend scouting investors, ahead of FY-2023 earnings season. At different intervals, we expect mild selloffs, albeit insignificant.”
