₦airaland Forum

emmanuelewumi:
They also consider the moving average stock price for the past 6 months and discount it to determine the loan amount to approve

My only issue with it is that UCAP charges 1% fees.

If I take loan at 84% from my current guys, I pay 350k interest per month.

But with UCAP I will pay additional 500k in brokerage fee compared to MCSE.

Cos I trade c. N100m monthly.


Whoever knows folks at Morgan Capital, please convince them to partner with an MFB.

With Morgan's 0.5%, even 60% p.a is still cheap.

emmanuelewumi:
You can apply virtually.


Minimum loan of 500k

Maximum loan of N100 million.

Thank you boss.

emmanuelewumi:
There loans are for 6 months after which you can rollover again.

Eg N1 million loan at 30% the interest will be 150k. To pay back N1.15 million at maturity.

He can pay the 150k interest and 500k of the Principal at maturity.

Can then rollover 500k for another 6 months

I missed your post on this.
Please answer these:

1. Can I open the account virtually?
2. How long after before I'm eligible for the loan?
3. What's the max amount?
4. Do I need to use ucap as my brokers, if so what's their fee % on trades?


I've been paying 7% flat on facilities, I was hoping to reduce it to 5% this year. Now I'm seeing 2.5%?

HesInMe:
This is why my first point was that you have to be sure whether you're looking at real or nominal GDP. You did not clarify which one you quoted.

In the exports examples you pose, real GDP will not change simply because of currency devaluation. It measures the true underlying economic growth; the GDP deflator accounts for changes in local purchasing power as a result of devaluation. Nominal GDP, on the other hand, will rise from exports following devaluation, like you suggest. But for inputs consumed domestically, only the final value will be included in the calculation.

Let's leave some of the theories,.

Are you saying because cocoa were exported, it's contribution to GDP should still be recorded as 460bn, when today that value is 3.2trn.

Or because oil were exported, it should still be recorded as 18trn when it's now 64trn.

This doesn't make any sense.

Were the same item not exported in 2022.

Why were they not valued at the same rate they were valued when 1 USD was #80??

Leave real or nominal jargon.

Could you please address the reason why GDP being the value of goods and services isn't quite showing the current value of those goods and services.

Maybe if you can explain what they mean by "rebasing" it would make more sense, cos they did it before in the past, and the figures then became sort of up to date.

GeneralDae:
That’s why it’s a catch-22 situation. If Cardoso makes interest rate 20% today, that would be 14.6% negative for investors when looking at inflation of 34.6%.

In the absence of viable increase in major exports, Cardoso stabilised the exchange rate around 1500-1700 between June to December 2024 and it was mainly by FPI’s and remittances. The increase in FPI’s is due to the current 6% negative which is better than what we had in 2023.

In 2023, we had perhaps record low dollar inflows due to the fact that we took so long to increase rates to match inflation numbers. As a result, naira at the black market rate devalued fast from 750 to 1200 approximately between the corresponding period of June to December 2023.

I understand, but I believe his priority shouldn't be to investors, rather it should be to the other 90%+ of the population who could certainly use more value for their little earnings vs consistent dilutions.


Also, I agree about the impact of FPIs in 2024, but I'm saying it's time to start winding down on the rates


Why keep borrowing dollars from FPIs at 30% when we were offered $9bn in eurobond at 10%.


Carrying $5bn at 10% would cost just $500m, so why should Cardoso prefer to carry it at 30% and expend $1.5bn, that extra $1bn can be used to reduce the debt stock of the country if nothing else.


I just feel the man is getting too comfortable with performance that seem quite mediocre in my opinion.


In 2017 too, Emefiele elevated yields to around 20% but by late 2018 when rates became stable, he started winding it down to a point where yields in Nigeria became as low as US yields (sub 1%) yet the stability stayed, black market was even doing 355 to official 362.

It took terrible COVID shock to the oil market where sellers were paying buyers to lift oil (oil selling for below $0) for the currency to start faltering again, but even then the fall wasn't as steep. It was under 40% yoy.

GeneralDae:
Well with inflation now at 34.6%, it would be difficult to maintain the 10% interest rate Emiefele left it at. In Emiefele’s time, inflation grew steadily to 22% at most. It was below 20% for the most part. The current CBN is in a catch-22 situation. The removal of subsidy and naira devaluation did not occur in Emiefele’s time, so he was able to maintain a more reasonable rate while printing over 6 trillion naira in 2022.

Yes. I agree that 10% isn't realistic, which is why I'm proposing 20%

After all the 30% hasn't quite helped in curtailing inflation. If anything it's been probably contributing to it by creating more money.

Last year we had N100trn chasing our goods and services, this year, it could reach N130trn. If the quantity of goods and services don't increase at the same rate, Cardoso would effectively be rendering the currency worth less and pushing prices higher.

ositadima1:
That is why some TA theories may not work as expected. Specifically, the so-called "Burundi Bull" followed by the "mother of all crashes" that some practitioners promote does not apply here. I like to think there is no general bull market; instead, what we are witnessing is a repricing of stocks, either gradually or rapidly in some cases.




This is just my reasoning as a layman. I am not an economist—just a below average person sharing my thoughts.

An above average guru you mean.

ositadima1:
To the FA crowd: Are we likely to see an upward repricing of most company assets as financial results start getting released? A Tokunbo car purchased for ₦2.5 million in 2022 is now worth ₦4 to ₦5 million. Similarly, land, buildings, and other assets have all seen significant price increases. I believe the asset sections of most stock reports will be revised upwards. How will the market react when this happens, or is it already adjusting in anticipation?

N2.5m car at that time is worth at least N5m except the owner lives in a terrible neighborhood where the car has gotten into very bad shape.

This is sort of the first time the saying of cars being depreciating assets proved false, cos almost everyone who wants to sell cars bought in 2022 now will get more money for the car in naira terms.


About companies revaluing their assets, without any regulatory constraints, they should consider it.

When NESTLE did in it 2024, the assets showing N91bn in their books were revalued to N315bn which was more in line with reality.

I mean how much was one acre in agbara before, how much is it worth today, how about 10,000Kva Perkins generator, etc.

GeneralDae:
Well increase in prices alone would not automatically boost the GDP at thesame rate of depreciation of the naira. For instance, many businesses and sme’s may have closed down during the early stage of the reforms (Q1 and Q2 2024). Slower purchase of goods by customers would mean the businesses are not having thesame sales volume, making the growth slower. Till date, telcos are making losses and are yet to have competitive pricing to make the kind of profit they made in 2022.

So I agree the growth should probably be higher than what the NBS is reporting, but I believe in 2024, the economy was struggling to adapt to the shocks. If the fx rate doesn’t depreciate steeply in 2025 and the inflation declines even to just 28%, you would see that economic growth reflect again and we would be better than we were in 2022.

Looking at the stock market for instance, as at May 2023, it was approximately $40 Billion ( using black market rate of 750). Today, using 1650, it is also geared towards $40 Billion.

Awesome.
Second issue:

If a CBN governor complained that the reason the currency has lost value was cos 30trn was spent on ways and means and intervention over a given period, but he himself is printing extra N10trn annually that could be avoided, isn't he towing a similar or worse path?

This is what I mean?
If N100 trn in money supply is priced at 30% interest rate rather than a more reasonable 20%, that extra 10% is diluting the money supply even more.

Emefiele kept NTB yields below 10%, baba has carried it to 30%, government debt service alone will go up by at least N3trn due to this elevated rates, then you think of CPs, OMO bills, bonds and even bank loans, the impact of these elevated rates is almost same with ways and means as far as money dilution us concerned.

Even without naira crash, money supply will soon reach N120trn cos the rate of money printing is just quite excessive at 30%

HesInMe:
Good question. Actually, (nominal) GDP is the final value of all the goods and services produced each year. It measures the value added along the production chain, not the total value. And, generally, when input prices go up lower down the chain, you don't necessarily see an equivalent jump in prices of value-added goods and services. That's why you're not seeing the increase you'd expect in the examples you gave.

On final value: I'm not an economist, but let's simplify with an example. Let's say you buy a litre of petrol at filling station for N1,000. To get to you:

NNPC sells crude to refinery - 400 per litre of petrol
Refinery sells to filling station - 800
Filling station sells to you - 1,000

The "gross value" would be 2,200 (400+800+1000), but NBS will only count 1,000 -- the final value of a litre to the end user -- as contribution to GDP.

If you think about it, that's the total value added by each step of the production process:

Crude extraction - 400
Refining - 400 (800-400 cost of crude)
Distribution - 200 (1,000-800 cost of supply from refinery)
Total value added - 400+400+200 = 1,000

Yes, your analogy makes much sense.

However. Take crude extraction. If it was 400 in 2022, my point is that today it's now 1800.

I mean IN 2022, 500 million barrels were extracted at $80 per barrel and #460 per dollar will translate to N18.4trn contribution to GDP.

In 2024, production is up marginally, say 550 million barrels were extracted at $75 per barrel at #1500 per dollar, why isn't that showing as N62 trn contribution to GDP.


Take cocoa beans: 250,000 tonnes at $4000 per tonne at #460 to the dollar, it contributed N460bn to GDP in 2022.
In 2024, it should be 240,000 at $9000 at 1600 per dollar contributing N3.6trn.

So cocoa as a produce has had about 9x increase, beans is like 4x, and from palm oil to rice to garri, every agricultural produce has had at least 2x increase. Why is agriculture being the largest contributor to GDP not showing at least 100% growth.


That's my whole point.

GeneralDae:
Where did you get the 198 trillion naira data from? As at Q2 2024, it was 229 trillion naira on the NGX website from what I saw.

My point is not on what the exact figures are.
It's on the growth being a paltry 10% when all the constituent goods and services have had perhaps 150%+ increase.

For simplicity.

Take the GDP in 2022 to 2024 to be like this:

2022. ... ....... 2024
Agriculture. 60trn. 120trn
Telecoms. 10trn. ..... 15trn
Industrial goods. 10trn. 20trn
Manufacturing. 10trn. 20trn
Oil and gas. 20 trn 60trn
Services. 70trn. 100trn
Total 180 335trn


From cement to tiles to malt to noodles and from the top line of companies' results the estimate are conservative.


Why is the growth not closer to 80%+?

That's my point.

HesInMe:
I suspect you are conflating nominal GDP with real GDP.

Nominal GDP -- the raw GDP number -- is sensitive to inflation, and appears to be what you are thinking about. Real GDP adjusts the nominal one for inflation using something called the GDP deflator, so its growth is less remarkable but speaks to actual underlying progress in the economy.

Believe it or not, NBS is a top-notch organization. Their website, though...

I'm thinking of GDP being the gross value of all goods and services produced in a country over a year.

If every components of the GDP have increased by an average of 100% over a given period, the maths says the GDP itself should have increased by 100% not the mere 10% they're reporting.


Take electrical cables for instance, coils that sold for 8k in 2022 became 24k in 2024.

If contribution of coil manufacturing to GDP in 2022 was 1trn, if they've sold the same tonne in 2024, that contribution should have tripled to 3trn.

Then you take every single aspect of the GDP, agriculture being the largest, from beans to garri to rice, to cocoa, there's no produce that hasn't gotten 100% price hike, some 300%, cocoa is like 700%.

So why is agriculture measuring 10% growth, when all the produce probably have 150% growth.


How many Companies on the NSE were recording over 1trn in revenue in 2022, what are the numbers like in 2024?


That's the point I'm making.

The numbers aren't adding up.

KarlTom:
Bagwa. Bovali. Awesomej

It's been a while.
Trust you're good...

I certainly am my brother.

Who can help make sense of these NBS figures.

This is what I think:

In 2022, the country's GDP was around 180trn, then in 2024, it's being measured by NBS as 198trn.

It looks like they're aren't doing any real measurements. They just sit in their air conditioned offices and churn out figures that have almost zero correlation with reality.


Between 2022 and 2024, there's hardly any good or service that hasn't increased by at least 50%.

Start with garri: 2022 was #700 per paint, 2024 was #2800 per paint (300%)
Rice: 100%

Now to oil:2022: about 500m barrels produced at say $80 and #460 to the USD, that's roughly 20trn.
2024: about 550m barrels produced at say $75 dollars and #1500 to the USD, that's roughly 65trn.

So oil alone has added 45trn

Then check MTNN revenue in 2022 as a matter of fact, check NSE30 revenue in 2022 vs 2024 NSE30 alone added over 5trn if not close to N10trn.


I think whatever they're measuring that's placing the economy as the 4th or 5th largest on the continent needs a thorough inspection, cos the same devaluation that they think has forced down the GDP numbers in dollar terms has doubled or in some cases quadrupled the values of all the goods and services that make up the GDP.

Then inflation, at the height of the naira crash in February 2024 when dollar was touching 1900, there was no food item that had not doubled in price compared to February 2023 when USD was 730.

So why were they reporting food inflation at 35%? What kind of items make up their basket, abi which store were they making the purchases from?

It basically feels like NBS figures are not at all connected to the economy, they just churn out whatever they feel like, or perhaps whatever a thwarted computer algorithm spins out.


Maybe I'm missing something, someone WHO KNOWS better can enlighten.

Did fmdq actually trade $1.4b dollars in a single day yesterday?

That's like turnover for an entire month for H1 Last year.

Maybe this 30% yield will actually help FX.

GeeKudi:
Working fine here

It was down for about 15 minutes on my end.

I just hope they capture all my trades.

Itsrm:
This is reminding me of NNPCs rain, lightning and thunderstorm causing fuel scarcity.

Trust DMOs system issues at your own risk. All lies.

😁😁

Agbalowomeri:
Person rent part of his house give. He turned around and says he is not doing again. Wetin Una still dey wait for bayi. As long as he has 51% of the shares, Una no get say abi are you a chosen?😂

😁😁

KarlTom:
Sadly this was all premeditated...

The last throw of the dice rests with the 'authentic holders' and I sincerely hope they will turn up and outrightly reject this scheme.

Going by SEC rules, ₦70 is a generous buyout (highest CP in last 6months was ₦46) but faithful shareholders deserve more.

Buying out FMN at 280bn still looks cheap. That's just about 0.18x revenue.

emmanuelewumi:
I hope shareholders will reject this and insist on a minimum of N100


Flour Mill is the first company on NGX to attain a revenue of ove N1 Trillion. Unfortunately the net margin is usually lower than 2% and a return on equity of about 5%.

This would be a good one, but if they put the thing to vote at the COM, doesn't Excelsior have a commanding say? Putting the minority holders out of options.

In this sort of thing, since Excelsior is makitg the offer, they shouldn't have any day at all na.

It should be the minority holders alone that decide whether or not to accept.

Mpeace:
When gsk paid us for their divestment, them cut our 10% without any apology.

Wow...
That's too bad.

This is what I saw on PwC's website:

Mpeace:
70 naira is too poor. And they will still deduct 10% withholding tax. Na wa oh

Can someone else please help confirm if WHT will indeed be applied on this N70?


While 27% upside (at N70) may still be manageable.
14% (at N63) becomes too ridiculous.

I wish there was P2P for this, you would have found someone here that would buy at 18%, allowing you even make a little profit.

Ikmontana1:
i invested 8,950,000 at 19%, 289 days on the 27th of August last month, First Bank.

i investment the interest paid upfront too with the main investment, i didn't collect any interest

I went to the bank today for Full Termination of the investment, and i was told i will be paid 8,713,587.75 in return.

i.e 236,412.35 loss in less than 2 weeks

that i was charged based on the current discounted rate

Am really confused.

please help

Ask them the discount they want to take on it.

It looks like they want to take 22% discount on the remaining 279 days.

That's too steep, especially now that rates are falling.

You should be able to sell off at 19-20% tops.

presiade:
Yes, you're right; I only did a rough calculation to inform him. Morever, a figure 6 still appeared in the rough answer.

You mean figures 2,6,8 and 0 are in the rough answer too.

I wish I knew to use this update for my maths teacher.😁😁😁

Hogwarthtrades:
Say less, whenever i come across something you will be notified.

Awesome!!!

Hogwarthtrades:
like i said, whenever your team is ready (proof of concept mostly important, proof of scale becomes issue of results will give room for more addressable market share ) , i will be interested to join, hopefully i can create time and part with some coins

I do not have a team for this actually.
However if you form one, I would be willing to take 10-20% if we're able to reach workable terms.

Hogwarthtrades:
like @Jedisco mentioned, have you considered the regulatory part and marketing side of things, what demographics are you considering ?

I will be interested to drop a few coins if proof of concept and scale is evident in foreseaable future.

Yeah, the regulatory aspect can be the toughest part. Writing the code and marketing may not be as tough if one engages the right folks.


I imagine the SEC would require the board to include experienced investors with proven track records in fields like stock broking or asset management. This is based on the fact that CBN for instance would require you to have a CIBN fellow on your board to register just an MFB.

Oshokhai69:
Why do you assume that people must follow the same rules that you follow for allocation of their investment portfolio? Different circumstances call for different allocation principles. And yes, a portfolio with a higher fixed income weighting works for some people.

You cannot tell a retired man or one approaching retirement to be like you and put most of his money in stocks like younger folks that can afford to ride out extended bear markets.

Please don’t give unsolicited financial advice when you do not know anything about the person.

If you had a life, wouldn't you know to shut up given that the person to whom the post was directed has given an appropriate response.


Here you are again feeling the impulse to display stupidity on an early morning, later you'll say someone is making you look stupid.

The stupidity is all you man.

jedisco:
Hehe. Most would even charge to deposit into an investment account plus other additional fees.

Building the app is one, getting the regulatory approval is another then the right framework such that if the company goes bust peoples investments are safe. That way people can see stocks as a viable means to safe for retirement. The important part is marketing it and pricing it such that overtime, the returns sell themselves.

Many people I know who rushed into stocks years back can't locate their share certificates talk more of knowing the price. How many can properly scrutinise account statements? At least with a passive fund, you buy one thing and let the broker balance it in the hope that over time, you have better returns

💯 💯

jedisco:
Exactly @the bolded. Too much handling is a is another leeway for errors and emotions derailing ones portfolio. Also, how would one deal with reinvesting dividends or smaller sums on an ongoing basis? It's the reason why passive funds have become so popular and now largely surpass active funds. The fund managers should see profit but even factoring in the realities of a developing market, it's still quite exorbitant.

Let's float a startup to address this. Most fintechs seem only focused on payments.

jedisco:
Lol@ the bolded. Manually doing it can be fraught with issues

You can use Excel to automate 50%+ of the tasks.

You can use Python to automate 90%+ if you have enough APIs.

Although the size of the portfolio would determine whether the efforts are worth it or not.

If your annual returns are 10m or 100m and a fund manager is yanking 20% off, I know some guys that would build and maintain a good app for you for a tiny fraction of those fees.