₦airaland Forum

Transcorp had it's meeting last Friday that approved it's AR and planned to issue it by 1st of May latest. What's holding back the publication. A change in direction ? What change(s) ?

Heishere:
bond market seems to be inversely proportional to stock market

The article refers to Naija $ bonds that they've been bearish on for a while. Not Naira bonds. Will be good to know the proportionality of FX bonds to local equities. Most likely more of a direct proportionality than inverse.

https://www.reuters.com/world/africa/morgan-stanley-turns-bullish-nigeria-bonds-after-election-2023-03-02/

The bullishness will extend to stockmarket sooner or later.

Not investment advice. Do your DD.

,,

currentprice:
UBA and Access bank and many more are good stock bedsheet can waste time on not stock like interbrew.

ROE over 30% @ year end

Please what is the sheet saying about UBA. Access has gapped it a little. Access says it is reviewing impact of Ghana sovereign default on its accounts. Most Likely UBA will get some impact from Ghana too.

Hogwarthtrades:
Hey @OBAGADAFFI @yMcy56
Go through links of Annual reports below for estimate holding of Transcorp plc in its energy (oil exploration) , hospitality (transcorp hotel),etc sectors.
I.2022 annual report page 120 https://transcorpgroup.com/wp-content/uploads/2022/04/2022-ANNUAL-REPORT-AND-FINANCIAL-STATEMENTS.pdf you will see its vested interest in all its subsidiaries
II.2020 annual report [url] https://transcorpgroup.com/wp-content/uploads/2021/04/Transcorp-2020-Annual-Report.pdf[/url] page 92-93 same thing.
III. This is my bias/conviction speaking, take with a boatload of salt. Love this stock, hoping in the next 5 years ,I can continually increase my position to at least 7-8 figures holding for long term (at least a decade aka by the end of 2 terms of any govt. in power) for growth and dividend . It's has been and still is undervalued, outstanding shares is a blessing and a slight challenge depends on wht lens you see it from.It will probably be for another 5 years at this rate. Slow yet steady growth in the horizon of all sectors it is invested in.

Hope this age like wine not milk

I like the way their CEO - Owen Omogiafo, posed questions to the presidential aspirants at the NESG (Nigerian Economic Summit Group) engagements. Transcorp quarterly numbers are trending up nicely. I forecast the EPS for shareholders will be about 41 kobo. That is a PE of 3 at current market price. I don't expect them to pay much dividend. They paid 2 kobo last year out of the 34 kobo EPS last year. Thus this year may just be 3 kobo they will declare. As their current liabilities (used to acquire solid assets) is very high and they need to conserve money to pay this down. Their full year number should be out this week or early next week as Management approve the results this week.

I hope it ages like fine wine and not milk too

Redoil:
be patient it will surely come dowm to 7.50

What makes you sure ?
It will surely come to that level post dividends if the prices doesn't rise further before dividend ex date. Especially if the dividends stay flat at 80 kobo.

And can go even further down if the results are not so good or if the dividends go further down or if there are issues with the elections. Aside from any of these the prices will go up. And no one is sure of the direction it will take

lancee:
Be like say na mini bull or burundi wan get started ?

It's local value investors and Market Makers at work. Plus the few FPI's left no more pulling the sell trigger

lancee:
owo dee for Agba money growing like grass ...I was waiting for gtb @ 12

Waited for the FPI's pulling it down back to N17.6 and missed this current gains

Why did UBA start the first trading day of 2023 with a big sprint? Jumping from N7.6 to close today at N8.3 ! A jump of 9.2%

Maybe Mr Market is just remembering to price in expected dividend to be paid by April of 80 kobo or 100 kobo sef

ositadima1:
These are a few ways smart countries reduce their debt burden:

Increase economic growth: One way to generate more value is to stimulate economic growth, which can be done through measures such as investing in infrastructure, education, and research and development. A growing economy can increase tax revenues and make it easier for a country to pay off its debts.

Export more: Another way to generate more value is to increase exports, which can be done by promoting domestic industries or by negotiating trade deals with other countries. Exporting goods and services can bring in foreign currency, which can be used to pay off debts.

Attract foreign investment: Attracting foreign investment can also be a way to generate more value. Foreign investors may be attracted to a country with a stable political and economic environment, a skilled workforce, and a favorable business climate.

Increase productivity: Improving productivity, or the amount of output produced per unit of input, can also help a country generate more value. This can be done through measures such as investing in technology and training workers.

Nice and sharp bolded points. Looks like China used a similar script to pull itself out of poverty.

RabbiDoracle:
BRICS didn't vote against it, they voted for it. Even Nigeria voted for it.

It is about "A new international economic order".

https://press.un.org/en/2022/ga12482.doc.htm

Excerpts from the attached

The Assembly adopted the resolution “Towards a New International Economic Order” by a recorded vote of 123 in favour to 50 against with 1 abstention (Türkiye). By its terms, the Assembly expressed concern over the increasing debt vulnerabilities of developing countries, the net negative capital flows from those countries, the fluctuation of exchange rates and the tightening of global financial conditions, and in this regard stressed the need to explore the means and instruments needed to achieve debt sustainability and the measures necessary to reduce the indebtedness of developing States.

You can read more from the UN link or you can visit the UN site. Attached is the map of countries showing the voting pattern. This is concerning in my opinion and shows level of dissatisfaction amongst the 80%.

Just watch how the bonds of developed markets will trade.

Thanks for the clarification.
I can see two big ticket items from this short brief.

1. Debt sustainability issues of some developing nations
2. Capital Outflows from some developing nations

Number 1 looks like a problem developing nations really need to address by themselves. Why do they accumulate unsustainable debt. Looks like those in power in developing nations don't really have the interest of their nations. Perhaps a simplistic perception as even the USA debt also looks unsustainable. But the US debt can be managed by printing money. While the developing nations debt can only be managed by mortgaging resources. Thereby compounding their future Capital Outflows. Globally it will be ideal debts are forced to be only usable for growth activities (investments) that can return value (future cashflow streams in the borrowed currency or in a strong internationally traded currency) and not for consumption purposes that passes the burden of repayment to the coming generation.

RabbiDoracle:
United Nations General Assembly voting : Towards a new international economic order

Voted for : 123

Voted against : 50

Abstained: 1

Check out the split in the votes at the UNGA meeting. The emerging world vs the developed world. The 85% population vs the 15% population.

Lots of countries seem very tired of the current economic order.

Please what is the vote about in very simple terms. I can See BRICS voted against it.

Agbalowomeri:
As if someone else is the CBN governor throughout the period.
He kept mum for eight years na now cock crow

He has been alerting about the decline since long and been doing his best to execute existing CBN policies for fx earning through export drive and import substitution. And shouted earlier this year that NNPC is remitting nadding o. And there was a little back and forth from NNPC. Now the new NNPC has kuku come out saying their new way now is not to credit CBN reserves but keep everything. And if they declare a profit it will still not go to CBN reserves but I think finance ministry. So Emefiele cannot keep mum with this new twist. He needs to start shouting so that people go hear.

PRESCO was to give interim dividend on Friday 25th November. It has not dropped. What happened.

yMcy56:
ZENITH: Sighted @22.75 as at now........Up with +65k

GTCO: Sluggish earlier, traded as low as 19.95..........but gradually back to 20.40 yesterday's closing price as at now.........
*Still struggling*

DANGCEM: Full bid @262.30......Up with +N23.80...
Share buy-back effect I think......
UCAP, ACCESS, UBA, Transcorp........mvmt up... slow and steady....

The bear fought the strong bull in GTCO to a stand still with 1-1 goalless draw initially. With the bear scoring the first goal. But the strong bull resisted and equalized before the closing bell today Then it did a final push to lead with a tiny 10 kobo gain over yesterday

Make the bear gather strength joor with the support of some election bears and push GTCO back to N18 before other bulls wake up and decide to push the price up .

Agbalowomeri:
The bull behind this look forceful
I am not expecting any shedding till the next resistance

Right now, for GTCO that forceful bull has yielded (lost 40Kobo) out of the big forceful gain of yesterday. Price dropped from N20.40 to N20.00

But the bull is at standstill with the other banks. Match never finish for today. Maybe the bull will stand up to resist this bashing and win the day

Key interest rate raised today to 16.5% by the CBN

pluto09:
I want to believe the person selling GTB earlier is no more selling.
The sell pressure has reduced for a while.

Those are the real drivers. And they are not too predictable. If they do not show up again the technical analysis will start speaking from another mouth.

Agbalowomeri:
GTCO inverted hammer today
Going by the books, it should start shedding some weight from tomorrow

Great! Let us see how soon it can get to 18 and below again.

thesilentone:
It is true but they have been doing this for well over a year, precisely Nov 2020

That must be so, for the price to drop all the way from above N30. I looked up what their holdings were some months apart this year and I saw they pulled out a chunk. They have been pulling out from our banks for a long time. I can recall seeing up to 10% total holdings a decade or so ago. Now FBNH is about 1% and the rest are like 3% to 4%.

thesilentone:
Typical move by grandfather Warren.

Margin of safety is a quality move.

Some foreign fund managers seem currently bent on exiting or reducing their Naija GTCO positions. A lot has been disposed in the last couple of months.

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.