Access Bank Plc plans to raise about N70.343bn from the capital market through public offering of 4.721billion ordinary shares of 50 kobo at N14.90 per share.

The bank had after the endorsement of the shareholders for the offer at an extra-ordinary general meeting in May applied and received the approval of the Nigerian Stock Exchange for the offer. But the offer price has been kept a secret.

However, competent market sources told the Punch yesterday that Access Bank Plc. would offer the shares at N14.90, which translates to a discount of N4.42. The bank’s stock is currently under technical suspension at a price of N19.32.

So what does this mean?

Is the 'discount' a deciding factor or is there more to ask before an investment is made concerning the stocks?

There are a few stocks also out there competing for your money - What analysis are you relying on to make that call?

While you are pondering on this - check out the investment opportunities in the market http://www.proshareng.com/myproshare/portal_articles.php?id=1108

We will like to know what you think of the Access Bank Plc Public Offer and your decision criteria.


Thank you.

'Debola Alile

I actually like to do some analysis myself and support this with the recommendations of my broker and other fund managers. i am yet to get such from them but would think that there exist a premium of N4 already for me.

my only worry is why give such a huge discount when in actual fact the share prices simply moved up so rapidly some period before the suspension. that is what i will like to know. Do i buy and just sell off immediately or do people think the price will continue to rise up to its peers? sorry i raised more questions rather than answers, this is nija!

I dont like the fact that they did not pay any dividends in the last two years .

Here is what two seperate people had to say to an enquiry on the offer,

One i believe it is very wrong to allow banks or companies that did share reconstruction to come to the market so soon after that which i believe is a way cheat investors. So how is one sure that after this PO, there wont be a subsequent share reconstruction. Imagine buying 25,000 shares of a bank only to wake up one morning and be told your shares are now 8000 plus. Yes it happened to me and i was so pissed off that i sold all the shares i own in that company and at a loss too. Access bank was basically a penny stock until it did share reconstruction. Then the price got manipulated - as most prices in the NSE are whenever something big is going to happen. As a result i will let this pass. I am not touching any of those banks that did share reconstruction by a mile.


Another:
I am not the best of a financial analyst but I think at N14.90 and a discount of N4.42, the offer is a good deal. It has the potential to do pretty well in the near future for both short term and medium term traders.
On the side, what is happening to Transcorp, and when will they issue their share certificates for the last IPO. The share has been on technical suspension for so long that it is frustrating and annoying. They did a good road show here in the US and I bought a lot of units. Since January, it hasn't made any significant improvement. AND WHAT ABOUT IBTC and when is it likely the technical suspension be lifted?

my questions have still not been answered?

Are there any penny stock in nigeria??

Penny stocks, mmmmhhhh maybe that was in january. Even the dead companies are being bought by some investors both local and foreign. Even Scoa i cant believe could even rise, I will say the Nig stock market is the new 8th Wonder. Meaning aniting can happen in this country. But lets keeping praying that our democracy keeps thriving.

@all

Would like to know the effect of the 10%Vat on the market and the prices of stocks

@nijainvest

Your analysis is only half-true. When Access bank did a share reconstruction by halving the share holders` holdings they also at the same time compensated by making sure that the price of the share doubled so in effect the value of your holding is still the same.

We bought about 100,000 units back in 2004 at about 1.65 Naira now the price is about 20 Naira now and  with this new IPO with a discount of about 6.00 Naira its your call if you want to invest in the bank`s IPO. Personally i believe the shares are trading at their peak so not much room for an upward movement. This is what i think personally and not backed up by any facts or figures but just gut-feeling

I think Access reconstruction is fraudulent if u ask me.Look at basic everyday info:thier first IPO was almost oversubscribed but eventually there is nothin on ground to show for shareholders funds;i mean where are the branch network they promised?or did they use evrything to make thier million naira animation advert?the current price quoted reflects an unreal picture and should be disregarded.As for wether its a good buy? No!!

IT wasn't just the reconstruction. They also listed new shares based on some foreign investment converted into shares. This further diluted the value of the shares on the open market.

If you like doing POs (I don't), better ones have gone and better ones will come. This is one to stay away from! The fundamentals are weak, v v weak.

this discourse is serious.more posting guys.

Like i said earlier i think Access bank is selling at their peak so not much room for upward movement in share prices. They have also raised capital by selling bonds just to bump up the shareholders funds so if you divide the bank`s market capitalisation by the number of shares held by investors that is not a lot in terms of the share price which is why they had to do a share reconstruction in the first place to reduce the shares being held by investors. So I wont be surprised if another share reconstruction `happens` in the future.
This is not to say whoever wants to invest should not but Access shares i think have had their day.

I will set aside my bias against the bank which arose from their discriminatory and terrible HR policies in advicing you on access banks share.Even as an amateur financial analyst,i still consider some basic fundamentals before plunging into any stocks.want u to consider these issues.i)Can the banks present earning support the share value?ii)av they paid out dividends or bonuses in recent years?Have u seen their published results in the last few years?The only asset the bank has is the management team(a valid reason to invest in any company),but how far can they stage manage things without cheating investors?My verdict on the stock is this.Buy if u know u want to really stay on the long term and be ready to make painful sacrifices.Also pray the management team gets it right all thru the stormy times ahead of the bank.

i was thinking of buying but with what i have held so far and the question i have ask my broker i think this one will pass for now.

Hello People,

I will advice you put your money in the elephant (1st Bank) the king of banks in Niaja than access bank.

Cheers!

There seems to be so much pessimism concerning the Access bank offer.

Permit me to disagree with those who think this offer is a bad one.

This is my take on the proposed Access bank public offer.

Access bank has cut the number of outstanding shares by 52%, causing a corresponding increase in its share price.
The 3rd quarter profit after tax was 334% ahead of that of the full year result for the preceding year.

Earnings per share is expected to hit the highest levels ever recorded in the bank's history.

Translation:

In a market where share prices are pushed upwards once there is a rumour of bonus or scrip issue (regardless of fundamentals), the increased profits after tax that is expected as well as the projected increase in earnings per share make scrip issue and or dividend payout this year very very likely (especially since the bank has not done so in the last two years and would not want to be left out in a sector where this is the norm).

Access Bank shares will soar after the public offer. This is my prediction.

The so-called stall in share prices will only occur after this financial year, when the impact of the absorption of the shares from this public offer and that of any scrip issue (if given) willl begin to tell on the stock (review the history of First Bank in the 2005/2006 financial years).

I think this offer is A GOOD BUY. In fact, I even prefer to buy Access Bank than to buy First Bank!

STRICTLY MY OWN OPINION. The experts in the house may not agree with my analysis.

''In a market where share prices are pushed upwards once there is a rumour of bonus or scrip issue (regardless of fundamentals), the increased profits after tax that is expected as well as the projected increase in earnings per share make scrip issue and or dividend payout this year very very likely (especially since the bank has not done so in the last two years and would not want to be left out in a sector where this is the norm''.This statement made by Enolase confirms what we have been saying about access bank.They depend on rumours,hyping and suspiciuos strategies other than fundamentals to shore up their share prices.I am not saying that access bank wont be profitable,but investorS must be ready to make painful sacfrifices.Finnally,ENOLASE which departmrnt do you work at access bank.i want u to review what you just told us and see the vivid flaws.Thank you.

@damoche07
It would surprise you to know that Enolase does not work for Access Bank Plc. On the other hand, I would be surprised if you did not go on to search for his well thought-out posts on this forum. The man talks sense, and he is a Medical Doctor. I was not going to look at Access Bank, he may have swayed me with the analysis above.

If the proponents on the side of access as being a good offer are serious on the N4.42 discount, then what can we say of FBN, a more sound bank with a discount of N 7.40 ?

@ Enolase,

Allow me to disagree with your analysis

1. Access bank's EPS is at an all-time high not because of better fundamentals but because of share reconstruction aimed at reducing the number of shares without adding value. The EPS went up but so did the price and therefore the PE stayed the same. No winner, no loser. Frankly, any company that is growing will always have an EPS that is at an "all time high"

2. The bank is growing rapidly but not at 330% like you quoted. You used a sleight of hand in your calculations. Access bank declared PAT of N1.64B in 3Q to Dec 05 and then declared only N0.74B for the Full year! Meaning they lost N0.9B in the 4Q! Comparing apples to apples, they are only 90% up when you compare the last 3Q to the previous 3Q (still quite impressive but not 300%). Quoting 300% rewards them for losing money in 4Q06!

3. The current market price already accounts for that 4Q loss and the growth rate and the current PE is 59! If you project the 3Q result to Full yr, the PE will be 40 at the offer price and 52 at the market price. In other words, this share is 2X the cost of GTBank!

If you accept the bank can keep growing at 100% p.a. (u wish!), the PE at the offer price will be 20 a year from now. A reasonable PE but u have to wait one year. I expect the stock will make the usual after-the-suspension-is-lifted run, but how many people have we heard on this forum crying about missing certificates. By the time u get your cert, the price would have declined (see Dangote) and u'll be waiting for the fundamentals to catch up to your stock instead of the other way round.

Say no to POs!

Bloggers, what if the analyst report on Access Bank Plc. confirms this to be a good buy?

By the way DANGOTE FLOUR MILLS is coming to the market in 2-3 months time and DANGOTE CEMENT will be coming to the market in 3-6 months time.

Now back to Access Bank Plc, my advice, let us wait for a thorough analyst report which can be posted on this forum to allow everyone make their own independent analysis and compare to previously held positions.

MORE ON DANGOTE GROUP.

New Dangote IPO out soon!

The Dangote Group will in the next few weeks/months enter the market to raise funds through an initial offering for its FLOUR, CEMENT and REFINERY businesses.

Mr. Uzo Nwankwo, Group Executive Director, Corporate Finance of the group disclosed this information to Proshare at an exclusive interview held at the London Stock Exchange building where he had received the landmark award from African Investor (Ai) for the best IPO in Africa.

Dangote Sugar Plc. Edged six (6) other firms including Standard Bank, Uganda to win this award which was witnessed by lead investors from the ‘city’ and African stock exchanges.

While the company is continuing its expansion plans for the sugar business which will receive a further boost from the new EU rules which has removed subsidies hitherto enjoyed by European farmers and which had made it a challenge for firms like Dangote to be competitive; it looks now to a wider market which can only mean a better prospect for the fortunes of investors in Dangote Sugar Plc.

INITIAL PUBLIC OFFERS

Given its commitment to ensure that Nigerians participate in the growing opportunities in the economy which the company is well positioned to serve, and the excellent vote of confidence in the company by institutional investors which Awill manifest in its ability to set up shop (for specific businesses) in
* Algeria – Sugar Refinery;
* Senegal – 200 metric tonne cement factory;
* South Africa
* Port of Maputo: and
* Increasing capacity of the Nigerian operations.


Specifically therefore, the group has earmarked the following estimated timelines for the following subsidiaries to go public:
Flour Company: Next 4 – 6 weeks
Cement Company: September/October 2007

The Port Harcourt and Kaduna Refineries would also become public companies and have their shares offered to Nigerians and the investing public through an initial public offering in 2008.

This is the most informative discussion, i've come across in a long time.

Not really sure whether Access bank offer is good or not but what makes the bank(Management team, EPS, PE and long track record of good performance) is the only thing we can rely on to make our decision whether or not to pay their shares

I think we should not preempt the mgt of the firm, under the leadership of Aig the top is their only destinatiion. Lets wait for the prospectus and see what they have to offer. Lets also see what the audited report will be like.

The PE ratio though not looking too fantastic for now but the audited report might be a different pix.

I think this might interest some:
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@ naija_lawa

What manner of seminar is this Is it some way to rip people off their hard earned cash and by the way who on earth are all these facilitators. U just picked their cv's and put in their just to entice us abi? What have they done and what have they being doing before now, list their achievements let us see. Just because the market is bullish everyone is now talking stocks. Why did they not bring such seminars before now. Pips like Abayomi Obabolujo has bin doing the sock watch thing for a long time even when a stock like costain was less than N1 and i have richly benefited from his teachings.All these people should not come and rip us off,

Moderator i dont think this access bank topic should be an advert forum, i suggest u delete it completely as u have specified in the home page. Say no to fraudsters.

After all Naija Lawa

Interesting range of views on access bank,

I can't find any mention of the sale today of:

National Salt Company of Nigeria Plc


SPECIAL SALE OF SHARES

The Nigerian Stock Exchange has notified the general public of a proposed Special Sale of 400 million ordinary shares of National Salt Company of Nigeria Plc by the Dangote Group, which is core investor in the salt company.

The Special Sale will hold on Friday, 15th June 2007 on the floors of The Stock Exchange at =N=22.00 per share. Interested members of the public can place their orders with Vetiva Capital Management, a dealing member of The Nigerian Stock Exchange.

What do people think, is it worth investing in?

@ All
just saw the contents of this thread posted on the proshareng website. Looks like a simple copy and paste job. Even though I know nairaland is in the public domain, something doesn't sit right with me about taking our comments ad verbatim and using them to promote another site.

Saw the contents also. I wonder also y proshare should just copy peoples views and post to theirs. I cant even remember seeing ani reference stating the source.

I tot proshare was better than dis. Aniway ,

Dear easimoni and Allcorrect,

The discussion was pasted on the proshare webiste to encourage others to join in the discussion on www.nairaland.com.

The thread of discussion was quite insightful and we felt if we got more 'investors' to join the forum, the users of this site might benefit from their viewpoint rather than acting as an umpire.

the purpose, if you look at it, should benefit the nairaland forum, where i have seen very strong views on stock related issues. It is not in our place to use the comments made on another site to promote our site. In this case, we sought to improve the information access to gain a broad based view of the issues as part of our public view survey on an impending offer for which we would also post a copy of the final report on the forum.

I do hope your concerns have been allayed. thanks for the comments on the site.

As per Access Bank offer , i have some reservations.

Granted those of us that invested when the shareprice was between N2-N3.5 , gained immensely from capital appreciation,but a look at their last annual report would reveal some skeletons.

The bank was fined millions of naira for ,  insider trading , essentially the directors were taking loans and the loans were not performing. I'm certain this shouldn't repeat itself, but for the bunch of well educated &forward looking guys managing the place I didn't expect such.

So much for all the puffing about acquiring Union Bank ,Afribank etc,  Tell me guys here is the nearest Access bank branch to you?
Compare your answer to thenearest branch of Zenith,1st,Union,Oceanic,GTB etc.

So my verdict,  If Oceanic could come out for 13+ bucks , the access offer is slightly overpriced and the long term without a solid retail presence,  well.
In addition pls note & note well that Access has the 3rd lowest EPS(earning per share ) in the sector(10.56), compare with 1st bank(338k) GTB(164k) Zenith(191k)Oceanic(102k)

Pls note , this opinions are STRICTLY mine( I think I'm entitled to them)
Cheers,

@ Proshareng,
We are cool.

Proshare,

Thanks for starting this thread.

I have been receiving the Market information from you for some time,
though I never can tell where you got my email from
I know Femi is the brain behind Proshares and when I saw your username,
I said, "Femi is here as well"

I never knew there was any reconstruction in Access shares o.

I was with my stockbroker on Sunday and was asking him what happened to
Access Bank. I was like I've NEVER heard any news from them for the past two
years and he told me NOTHING.

I asked him if I should sell my shares, I bought about 3000 then and was given a bonus
as well, he told me to still hold on that Access has the potential of rising to #25 after
the PO.

Wait a minute. Does that mean my shares in the company is about 1500+?

Somebody should explain the reconstruction to me o.