₦airaland Forum

thesilentone:
I classified you as one of the two.

I am a bargain hunter at the moment. My small bid is off the table till I see it again at N18 or below

thesilentone:
You can make that happen too

Only a market maker or biggie can make that happen. For example it takes only a fund manager bent on exiting the positions to pull the prices down once again so as to dispose a chunk of shares. Or a pot belly (biggie ) to bid up prices like Ote$ did to FBNH to accumulate shares.

For now the bulk of bargain hunters have taken out their bids. We'll see how it swings next.

thesilentone:
More like today's move was impressive based on volume. Monday & Tuesday were just meh.

It is running straight into resistance though, so no yet uhuru.

Let it bounce from resistance back to low for the next week or two. Before bouncing up again for a new high.

RabbiDoracle:
No doubt that USD is still the asset to be in but soon DXY will need to collapse to 72. If 72 is broken, it will be a disorderly slide into the 54 to 58 range. Last time it fell so hard was during 2008 financial crash. So it means something worst than 2008 crash will make it reach those levels I mentioned above. And that will drag every global economy (whether healthy or not) with them.

As for the Chinese asset bubble:
Reals estate doesn't deflate once. It takes time.

And their stock market will need to stage a huge comeback with other EMs and DMs that are declining now. It could be a fast comeback. But it is air!

Like an earthquake giving a first warning shot before the major quake.

RabbiDoracle:
Deliberate weakening of yuan?

Remember that when inflation struck, many countries were sourcing USD to buy commodities. Basically the rest of the world was in need of dollars. So this could strengthen USD against other countries currencies that require dollar urgently.

And during that late 2021, there were serious issues with China Evergrande as housing issues triggered a liquidity crisis amongst real estate developers in China. This also led to selloff of Chinese RE developers corporate bonds as well as govt bonds. As you selloff yuan bonds, you change to USD, this creates instant wave of dollar demand. This can cascade until ordinary Chinese locals start changing too fearing further devaluation (as could be seen in Nigerian dollar herd effect).

As the Chinese govt saw this, and while Fed was preparing to hike rates, the BoC was easing rates and pumping more money into the economy because Real Estate was stalling and affecting financial centres. More money pumped, more devaluation.

So what is deliberate here?

Okay thanks for insightful reasons for the trend in the last two years.
However based on trends, till $1 starts fetching less than 6 yuans. Things are still in favor of the almighty dollar

By the way is the Chinese asset bubble over ?

RabbiDoracle:
Russia is pushing for multipolar order where lots of regions have a say as against unipolar order (where only US calls the shot). With multipolarity comes multiple currencies, multiple powers, choas as each jostle to remain relevant.

US knows that if multiple currencies start, lots of these dollars floating around will need to go back home to US soil. And that will be huge domestic money supply. So they will have no option but to fight all forms of financial acronyms (BRICS, MINTS, SCO or whatever) that are formed.

I will take the hint what you are saying has taken off once I see a steady weakness in the amount of Yuan a dollar can buy. Something below historical trends.

Thant is when $1 can no more fetch up to 6 Yuan. And is fetching less and less below 6 Yuan.

And for the Yuan to Naira if it stays steady fine. But the Naira should not depreciate faster than the dollar is depreciating to the Yuan.

RabbiDoracle:
Yes, any country can strengthen once people start buying your bonds. Bond market is the real currency.

Once China Internationalizes her bond market and becomes transparent, countries will start buying their bonds. Hence the yuan will strengthen against other reserve currencies. America will not like this. This will lead to direct confrontation with them.

Since the USD was the currency of choice for trades, it means that trade surpluses made by countries will be in USD and to invest these surpluses, central bankers invest them in US treasuries. This will strengthen the US bond market and also strength the USD against other pairs.

But with recent events leading to confiscation of central bank reserves, many countries will have to divest as fast as possible. This will cause serious funding issues in the US as most of their finances are funded by borrowing via the bond market. No willing country to buy treasuries leads to inability to fund lots of programs.

Something broke if you merge the charts of DXY (dollar index) and TLT (20 year treasury bond prices). These two charts have almodt closely correlated each other since 2008. As TLT prices rise, DXY rises as well and vice versa. But in December 2021, it broke the correlation. So as TLT prices fall rapidly, DXY rose rapidly.

December 2021 was when Russian troops were amassed on Ukrainian border and were ready to storm. The usual correlation was broken then. So this looks like a turning point in the global financial market.

We will see what happens going forward.

To keep this analysis very simple. At the end of 2021 you noted above $1 = 6.3 Yuan
That is dollar was at is relative weakest point to the yuan since 2018 by end of 2021. But has since strengthened back to $1 = 7.1 Yuan today.
That is a 12% increase in one year.
Why did China weaken its currency this year relative to the dollar. Which to me looks like China is propping up the dollar. I believe China is doing this deliberately to make Chinese products very competitive in the world. And price out any global competition. I think China will continue doing this distortion even if 1 to 1 digital currency trades should ever be established between currencies in the world.

RabbiDoracle:
China had been in lockdown since late 2021 yet no pullback.

Crypto had been falling since early this year yet no pullback.

I believe this is a structural change. And it is happening globally. Many countries will get onboard this in 2023.

USD needs to be badly devalued globally. It is not a Nigerian problem, it is a global problem.

US, EU and other developed markets need severe austerity to get rid of their excess unfunded liabilities. Poverty is coming to developed nations.

Till China puts its foot down and stop subsidizing the dollar, the dollar will remain bloated. The questions now are
* Will China ever strengthen the Yuan against the dollar ?
* What is stopping China from doing it or how is China planning to do it (or can execute it) without shooting itself in the foot ?

I think this dollar overvaluation stories have been on for years if not past a decade.

Nigeria Banking Sector: Analyzing Afrinvest 2022 Performance And Outlook
Theme: Brace for Impact

This is suggesting Q4 will pull down bank earnings. Will it impact dividends ? This Q4 earnings pull down may cause share prices to dip further over the next 9 months (i.e. during 2022 Q4 & 2023 H1). The trigger for this 2022 earnings pull back is increasing bank operating hours due to change in currency causing banks to expend more opex. Umh Mr Market over to you as you have a mind of your own

By the way. I think this analyst is unduly pessimistic. As it's only a few selected branches that will be open. Hence the impact on OPEX will not be that much.



https://www.youtube.com/watch?v=KjCMZPhmEcc

OBAGADAFFI:
Fintech can't crash commercial banks.
Commercial banks are also Deposit money banks

Nigerians are still dealing in cash transactions and Fintech can accept cash.

I would not have taken it seriously if not for CBN being the one raising the issue. The issue was raised as stated in the story, but how it could materialize was not included in the story.

ositadima1:
"Fintech refers to the application of software and hardware to financial services and processes, making them faster, easier to use and more secure. The fintech industry includes everything from payment processing solutions to mobile banking apps."

Traditional banks do these already nah, though the era of branch proliferation is coming to an end. In d near future, banks will run fewer branches as most banking transactions move online.

Good for investors and bad for d work force.

I observed in the last three years all the banks have been reducing staff except for Access. Perhaps due to it's recent mergers/acquisition. So perhaps they've started heeding the warning by upping IT. But the article mentioned names like interswitch eating into banks profitability.

JUST IN: Fintechs May Crash Commercial Banks &#; CBN Raises Alarm

https://techdigest.ng/fintechs-crash-cbn/

This doesn't sound nice. It means a time is coming naija banks will loose streak of profitability. How much time do they have left before fin techs start eroding their profitability significantly

OBAGADAFFI:
So Presco pays 2 interim dividends and 1 final dividend Every Year.

No. It's one final paid earlier in the year and an interim later in the year. Not three dividends per year.

OBAGADAFFI:
Is OKOMU paying interim dividend twice a year?

Presco kicked off twice a year last year and has sustained it with an increase this year. Not sure of when Okomu started.

RabbiDoracle:
Yes, all the banking stocks rose. Some names did x2 to x3 in 4 weeks. Mo gbe ja . Because it was too steep.

After that they lost between 50% to 60% in 2 weeks.

You can check the chart on investing site.

AKBNK
VAKBN
ISCTR
GARAN
HALKB
TSKB
SKBNK

Their financials is all over the place. Mostly flat on EPS, but with revenues rising sharply across the banks. In the first four AKBNK did well in EPS in 2021 and GARAN performed extremely well. Used the following to take a quick glimpse.
https://www.morningstar.com/stocks/xist/akbnk/financials
https://www.morningstar.com/stocks/xist/vakbn/financials
https://www.morningstar.com/stocks/xist/ISCTR/financials
https://www.morningstar.com/stocks/xist/GARAN/financials

This means some Naija banks will surely ride well on inflation. While some may not.

Thanks.

I just picked this story from google search
https://www.reuters.com/business/finance/turkish-bank-stocks-rollercoaster-ride-leaves-investors-reeling-2022-09-16/

Will Naija banks ride the wave of inflation to higher incomes or some may collapse. will look at those specific stocks you listed to see if there is anything I can learn.

RabbiDoracle:
Yes, all the banking stocks rose. Some names did x2 to x3 in 4 weeks. Mo gbe ja . Because it was too steep.

After that they lost between 50% to 60% in 2 weeks.

You can check the chart on investing site.

AKBNK
VAKBN
ISCTR
GARAN
HALKB
TSKB
SKBNK

This is Christmas gift to shareholders. Nice

yMcy56:
MORE INTERIM DIVIDENDS DECLARED....

PRESCO
Interim Dividend: N2.00
Qualification Date: 21st November, 2022
Payment Date: 25th November, 2022
Registrar: First Registrar
https://doclib.ngxgroup.com/Financial_NewsDocs/37162_PRESCO_PLC%20CORPORATE_ACTIONS_ANNOUNCEMENT_CORPORATE_AC.pdf

OKOMU
Interim Dividend: N2.00
Qualification Date: 15th Nov, 2022
Payment Date: 22nf Nov, 2022
Registrar: Cardinal Stone
https://doclib.ngxgroup.com/Financial_NewsDocs/37165_OKOMU_OIL_PALM_PLC%20CORPORATE_ACTIONS_CORPORATE_ACTION.pdf

AIRTEL
Interim Dividend: 2.18cents
Qualification Date: 9th Nov, 2022
Payment Date: 9th Dec, 2022
Registrar:
https://doclib.ngxgroup.com/Financial_NewsDocs/37167_AIRTEL_AFRICA_PLC%20DIVIDEND_CONFIRMATION__CORPORATE_ACT.pdf

Did Turkish banks participate in this steep rise or were left out. Please can you share the names of some of their banks that did well.

RabbiDoracle:
BIST 100

83% inflation, bank deposit rate at 16%, interest rate cut to 9%+

Nigeria just 20% inflation rate.

Soon the wind of change on NSE will be like BIST.

They now need to catch up on dividend payment, as well as start paying interim dividend. Fidelity has already beat them in kicking off interim dividend.

But can they. With their good PAT not reflecting in their comprehensive income. Looks like all the banks having significant foreign operations are hit with negative foreign ops currency valuation impact.

yMcy56:
FBNH
Impressive performance!!
*Over +1000% in Q3 2022 over Q3 2021
* Around +121% increase over 2021 year-to-date...
https://doclib.ngxgroup.com/Financial_NewsDocs/37050_FBN_HOLDINGS_PLC%20_QUARTER_3_%20_FINANCIAL_STATEMENT_FOR_.pdf

*Btw, Femi Otedola remains the largest single shareholder with 5.57% shareholding..
* Odukale trailing behind with 4.42%.........with Leadway RSA's 1.01% arguably separated from his holdings...

** Those pitying First Bank investors, hope Una dey observe the result as well...

If one needs to fill a form when will it be out ?. I thought holders of the shares will just be paid off and get ebuyout payment in their accounts like a dividend warrant automatically?

yMcy56:
UBN
At long last, Titan Trust is buying out minority shareholders......
@Mpeace are you still holding unto it?

From my % calculations now,
Bulk purchase from majority shareholders is 89.39%
Minority shareholders: 6.59%
So, 89.39% + 6.59% = 95.98%

Who owns the remaining 4.02% .......Or maybe this was acquired off record.

** For those planning to take part in the Mandatory Take-over @N7, if not already seated in the bus, you have only today and tomorrow to key into it.

Qualification Date is Monday 31st October 2022
..BUT for settlement purpose (T+3days), you have to buy latest 26/10/2022.
REGISTRAR: Cardinal Stone

pluto09:
If he had continued with providing subsidized dollar to every tom dick and harry, by now he would have finished our reserve and that would had been catastrophic.
At a time we were averaging 2m barrel of crude oil per day but now we can only do about 1million per day and you are still blaming the CBN Governor for not providing us with enough dollar. Where do you want the dollar to come from?

Also add NNPC remitting nadding for oil and gas sold this year to CBN reserves claiming it's all used up by subsidy. I don't know if people bashing Emefiele are aware of this NNPC not remitting to CBN reserves wahala. The only thing he is not doing well is creating money from thin air excessively to close the budget deficit that has been ballooning year after year over the last 8 years. Obaseki blew the whistle last year on this excessive printing. I think economists see that excess as one of the root causes of inflation.

owolabi5:
Me thinks it may be the Russ Federation

First, the elites fled

Now the Next Gen

The rate of brain drain is too high, how they will manage the Mirage of missiles remains to be seen.

Indeed it is imploding. Even it's military system seemed to malfunction attacking itself (effect of not being able to retain top notch brains).

Ibrahim505:
The volume with UBA is huge today, 50 million+.

Close: N7.55 today.

Mpeace:
Minor dilution naa. 3billion unit will be nothing if they continue with their current performance. The likes of UBA, GTB and Zenith would have been recording declining furtunes if not for the exchange rates issues in nigeria. If you convert their results to $ you realise that they have not been doing much for some years now.
The law of diminishing returns done catch them. On the other hand, fidelity has alot of space to grow

Okay so it's a minor dilution.

Mpeace:
Uba dont want to improve on their dividend. Fidelity will soon over take them

With the dilution in the works for Fidelity, it will be tough to catch up with UBA interim div.

This private placement in the works will dilute Fidelity income and potential dividend.
https://doclib.ngxgroup.com/Financial_NewsDocs/36728_FIDELITY_BANK_PLC%20FIDELITY_BANK_PLC%20NOTICE_OF_EXTRA%20OR.pdf

Mpeace:
Aswear. All interim and final dividends need to go up aswell. Inflation is biting hard and the naira has lost alot.
For the purpose of foriegn investors, dividends need to go up to meet the devalued naira.

Totally agree with you. Likewise earnings need to grow somehow in line with the growth in deposits that the banks state in their annual reports. I guess the growth in deposits is also a result of inflation.

Mpeace:
https://doclib.ngxgroup.com/Financial_NewsDocs/36715_FIDELITY_BANK_PLC%20_QUARTER_2_%20_FINANCIAL_STATEMENT_FOR.pdf

Fidelity have joined the interim dividend gang.
Nice result
Eps from 67k to 80k

Interim dividend if 10k.

Interesting.
Fidelity has beat First Bank in kicking off interim dividend payment.
With this 10kobo from Fidelity, UBA needs to perform better than 20kobo.

thesilentone:
Not averaging down is a general principle for me and not stock specific. I am happy to pay a higher price when the trend changes upward.

GTCO is no longer the leader in its sector but their fans won't admit it

Indeed GTCO has dropped performance in many metrics. The interest income that dropped in 2021 Q1 persisted into 2022 Q1. In the process dropping the EPS. There is a likelihood those selling may resume dumping if 2022 Q2 doesn't show improvement.

RabbiDoracle:
Commodities decline have bottomed.

We are about entering the sharpest and the most vicious rise in commodities.

Buy food and keep at home. Grow food if you can. It is gonna take a while.

Coffee, copper, cotton, crude oil, aluminium, rice, beef, Zinc, Gasoline and diesel, raw sugar, natural gas, ati bebelo will all rise so much.

Many nations (poor or rich but unprepared) could be destroyed by this rise. Societal collapse due to poverty could be a norm.

I'm still bullish NSE and other EMs.

At least for now plantain price has come down small. Abeg make plantain price no jump again now wey e done cool down small.

Mpeace:
their result is yet to be released by CBN.

We pray the audit which seem to be jointly done with the CBN will come out with goodies of increased dividends.

emmanuelewumi:
He said coupons from bonds are used for investment in equities. Some of the bonds will continue to generate predictable cashflow for the next 30 years, dont doubt the compounding and wealth generation ability of that strategy

Not challenging the compounding and wealth generation ability of the strategy once stocks are carefully selected and managed. Selection and management of the stocks is very key. My point is, at this point in time, buying new Naira bonds should be temporarily on hold for someone already into stocks, as there are stocks that will likely deliver the same cashflow over the next 2 to 5 years, by their dividend payments. And there is a strong likelihood those stocks will also appreciate in value in the same period. The cashflow from newly bought stocks dividends, can then be deployed in the same strategy to compound by buying more shares.

And portfolio can be re-balanced as desired to acquire more bonds in future. Especially when their is a rush by FPI'S etc to buy stocks and prices rise.

For someone building a kind of pension income through his or her portfolio it is a perfect idea to maintain a good ratio of bonds in his or her portfolio. With a slight managed deviation when the market opportunities come. At the moment a slight extension into equities is a good move. So if the desired conservative Portfolio was 70% bond and 30% Equity for example. Based on the current market it should be adjusted towards 60% bond and 40% Equity.

samsonline:
Well done my brother. You are doing very well. That is exactly my strategy, I want to retire on stocks dividend so I keep buying and I am ready to hold as long as possible.
Recently I changed my strategy a little bit, I am investing 500k monthly into FGN savings bonds and intend to do that for about 5 years and use all the coupon payments from the bonds to invest in stocks.

At this moment saving in bond is not as good as taking the risk and buying some stocks. In fact I sold some bonds to buy some of the discounted bank stocks without loosing any annual income from the change in portfolio. If the banks do no collapse I stand to even earn more dividends than the bond coupons in time due to the situation of the current market. I also stand a very likely price appreciation in the shares to the point I can covert back to bonds in future if I do wish and get a jump in income through coupons when there is rush to buy with confidence, shares in the market at higher prices.