Airtel, MTN tops list of most valuable companies in Nigeria after Q1 2023

Nigerian IT giants, Airtel Africa and MTN Nigeria, led the list of most valuable quoted companies in Nigeria in the first quarter of 2023, with market capitalizations of N5.56 trillion and N4.89 trillion, respectively. 

This is based on information gathered from the Nigerian Exchange (NGX). The list, representing the top 10 most valuable companies by market capitalization, also featured major cement makers Dangote and BUA Cement, consumer goods producers BUA Foods and Nestle Nigeria.

Zenith Bank, Geregu Power, Guaranty Trust Holdings, and Seplat Petroleum complete the list of the top ten most valuable companies in the nation.

A sizeable portion of the equity market capitalisation comprised the highest-performing top 10 companies on the NGX. The ten companies are valued at N24.09 trillion as of 31st March 2023, accounting for about 82% of the total market value.

Airtel stays top

The two quoted telecommunication companies in the Nigerian equities market, Airtel and MTN, remain the most capitalized companies in the country, jointly accounting for 35.4% of the total market.

The substantial and sustained increase in telco valuation may not be far behind the rise in internet service usage in Nigeria and globally after the COVID-19 pandemic in 2020. The world has gradually transitioned into a more virtual mode of doing things. This has contributed to the number of people that have become connected to a mobile network.

In the past two years, there has been tremendous growth in internet and mobile subscribers.

Remember that according to Nigerian Communications Commission (NCC) data, the number of GSM internet subscribers in Nigeria increased to 156.4 million in February 2023 from 125.7 million at the end of 2019.

For the nine months ending in December 2022, Airtel Africa saw a gain in revenue of 12.1% over the prior year, reaching $3.91 billion. However, profit after tax only saw a slight increase during this time, rising by 1.7% to $523 million.

In a similar line, the telcos’ financial statements also display impressive numbers. In 2022, MTN Nigeria reported revenue of N2.01 trillion, a 21.6% rise over the N1.65 trillion earned the year before. Additionally, net profit rose by 21.1% to N361.5 billion.

Read also: Nigeria’s broadband penetration hits 48% contrary to FG’s previous claim of 100%

MTN overtakes the Dangote group on NGx

MTN Nigeria was the second most capitalized firm in the Nigerian equity market in Q1 2023; surpassing Dangote Cement in the review period.

By the end of March 2023, the value of MTN Nigeria, which was valued at N4.38 trillion at the end of 2022, had increased by 11.6%, surpassing the 3.4% growth in Dangote Cement’s share value. Notably, compared to MTN Nigeria’s market value of N508 billion, Dangote Cement’s market value climbed from N4.45 trillion at the start of the year to N4.6 trillion at the end of the quarter, a rise of N153.4 billion.

However, the second spot between the two businesses is still fiercely fought since they frequently switch places.

Read also: MTN MoMo users increase by 21% as group records N437b in fintech revenue

The overall market performance

Taking advantage of the gains made the year before, 2022, with a 19.98% growth, the Nigerian stock market increased by 5.82% in the first quarter of 2023. When the year began, the All-Share Index stood at 51,251.06 basis points. It ended the review quarter at 54,232.34 points.

Similarly, the market capitalization increased by N1.63 trillion from January to March 2023, ending the quarter at N29.54 trillion. Prior to when it began declining and hitting 5.82% at the conclusion of the quarter, the market had enjoyed a solid positive start to the year, posting an 8.9% year-to-date gain as of the 9th of March 2023.

The CBN’s announced interest rate hike against the backdrop of the fall encouraged investors to allocate their capital to alternative high-yielding fixed-income instruments.

Top gainers

As market value increased by 241.8% to N945.4 million during the review period, Tripple Gee and Company topped the list of largest gainers. International Energy Insurance was closely behind, gaining 239.5% to N1.17 billion. By the end of March 2023, Neimeth International had increased its market capitalization by 128.1% to N3.48 billion.

Absolute value-wise, BUA Foods increased by N666 billion to reach N1.84 trillion, MTN Nigeria increased by N508 billion to reach N4.88 trillion, and Dangote Cement’s market value increased by N153.4 billion to reach N4.6 trillion.