September 14, (THEWILL) — About 26 listed companies on the Nigerian Exchange (NGX) remained dormant for five consecutive years (2020- 2024), characterised by stagnant share prices, profit and dividend drought and adding little to boost the market capitalisation of the domestic bourse.
The situation raises concerns over long-term profitability, investor confidence, and the overall impact of macroeconomic headwinds on the sectors the affected firms represent. However, some of these companies have attracted investors in recent times despite their moribund state as movements were noticed in their stock prices.
The affected companies, which cut across the sectors, according to THEWILatek ventures, NCR Nigeria, Chams Holding Company, e-Tranzact International.
Healthcare: Ekocorp, Marison Industries, Pharma-Deko.
Industrial Goods: Premier paints, Austin Laz and company, Greif Nigeria Plc.
Financial Services: Aso savings and loans, Deap Capital management and Trust.
Others are Secure Electronics (formerly National Sports lottery) Thomas Wyatt Nigeria (no dividends since 2007) Daar communications (No dividends since 2008).
Aside from recording a spate of persistent dividend drought, a common denominator that defines these firms is stagnant share prices. Over the past five years, the share prices of a significant number of the non-dividend paying firms have remained flat, with some trading below the N50 nominal value.
Industry experts posit that the stagnant status of these firms not only reflects weak investor sentiment but also signals deeper structural and operational challenges in their businesses.
However, some of the firms recorded significant capital appreciation as fortune hunters comb for greener pastures in the wake of recent reforms by the Nigerian government.
Investigation revealed negative and mixed performance in the shares of the following firms within the five-year period:
DN Tyre and Rubber Plc has a share price of N0.20 that remained throughout the five-year period (2020-2024). This has not changed nine months into 2025, suggesting that it will also remain in the league of profit and dividend drought firms during the year.
Golden Guinea Breweries Plc recorded the same share price of N0.81 during the review period. The firm, however, witnessed a sharp increase in market capitalisation from N813 million at the end of 2022 to N3.16 billion as of December 31, 2023 – a remarkable rise of 28%. This suggests that while the price stayed flat, either the outstanding shares increased or there was fluctuating trade that raised valuation. Outstanding shares refers to the total number of a company’s stock that are currently held by all its shareholders.
International Breweries Plc: The share price opened at N5.00 and closed at N5.55 in 2020. In 2021, the share price recorded N5.60 in the first trading and closed at N5.00 that year. In 2022, the share price was N5.10 at the first trading but closed at N4.80 in December. In 2023, the share price recorded N4.85 at the first trading and closed at N5.10 as of December 31, while the first trading in 2024 closed at N5.15 and closed at N12.30 on December 31.
The significant increase in 2024 is attributed to the rights issue and strategic financial restructuring the brewer embarked upon.
UNION DICON Plc: The share price remained the same between 2020-2024 standing at N8.00 throughout this period.
Multi-Trex Integrated Foods Plc: Within the five-year time frame, the company’s share price remained the same – at N0.36 reflecting a low but consistent valuation.
Nigerian Enamelware Plc: In 2020, the share price was N22.10. The share price remained the same at N19.90 in 2021, while it declined to N16.20 in 2022 but rose to N17.75 in 2023, before hitting N19.30 in 2024.
Royal Exchange Plc: The price remained constant between 2020 and 2024.
African Alliance Insurance Plc: The share price opened at N0.20 in 2020 and remained the same price throughout the five-year period.
Regency Assurance Plc: The share price remained N0.51 from 2020-2024.
Staco Insurance Plc: The share maintained a stable price of N0.30 for five years.
Universal Insurance Plc opened with N0.22 in 2020 and remained at that price through 2024.
Omatek Ventures Plc: The share price opened at N0.50 in 2020 and closed at N0.50 in 2024.
NRC Nigeria Plc: Share Price opened in the year 2020 at N1.20 and remained through 2024.
Chams Holding Company Plc: Share price opened in 2020 at N0.25 and remained through the five-year dividend drought period.
E-Tranzact International Plc: 2020 opened with the share price of N4.50 and recorded no changes during the five-year period.
Ekocorp Plc: Opened the year 2020 with the share price of N4.10 and maintained the same through 2024.
Morison Industries Plc: Opened the year 2020 at N0.50 and recorded no movement all through the review period.
Pharma-Deko Plc recorded a share price of N1.50 for five years.
Premier Paints Plc carried a share price of N3.00 for the review period.
Austin Laz and Company Plc brandished a share price of N2.00 during the review period.
Greif Nigeria Plc: The Share price remained the same at N6.00 from 2020-2024.
Aso Savings and Loans Plc: 2020 opened with the share price standing at N0.65. This price stayed the same through to 2024.
Deep Capital Management and Trust Plc: Maintained a share price of N0.50 from 2020-2024.
Secure Electronics Plc: Carried N1.00 share price throughout the five-year dividend drought period.
Thomas Wyatt Plc: Maintained a share price of N2.00 from 2020-2024.
Daar Communications Plc: Opened the year 2020 at N0.50 with the price unchanged through 2024.
Mike Igiebor, a finance expert, said that investors are beginning to show interest in the penny stocks because it affords them an opportunity to buy when the price is low and sell when it is high. “Investors are not looking at dividends, but price valuation which would earn them capital gains.
At the end of the last weekday of trading on the NGX on Friday, September 12, a total of 434,708,854 shares in 23,689 deals, corresponding to a market value of N16,163,654,159.42, were traded. Compared with the previous NGX trading day (Thursday, September 11), last Friday’s data shows 15 percent improvement in volume, 30 percent improvement in turnover and three percent improvement in deals. The current market capitalization of the Nigerian Stock Exchange is NGN 88.9 trillion.
***Written by Ogochukwu Onwaeze.
