₦airaland Forum

Northeastern:
Story story, hindsight bias.

There is no system that works.

When was the fundamentals of FO ever right?

Warren Buffet was only lucky that what he loved doing became a banger.

And the fact that serendipity smiled his way. For example, if Harvard had accepted him, there was no way he would have met Graham at Columbia to learn under his tutelage.

Experience is the best teacher. You'll learn the ropes by doing it.

Godlylifeoneart:
GTB will trade at +/-N1.5 in September
by Oct the price will nosedive to 32
Finally stopped at 30 naira at the tail end of 2018
If the polity is tensed... We will see it at sub N30

moneywoman74:
The change of strategy is that, I need more money now as responsibilities has drastically increases, therefore dividend alone is not enough.

moneywoman74:
The change of strategy is that, I need more money now as responsibilities has drastically increases, therefore dividend alone is not enough.

currentprice:
look well now

mendes911:
@Agba,

Considering that Diamond's Loss After Tax has been adjusted by additional ₦250M loass, are you still going to load at 50k?

Welcome back.

n/b: Please not an advise for anyone to buy, unless you intend to loose your investment in this buhari era .

stcool:
una funny no be small...Diamond bank @50k. that means GTB would be selling at N20. Well I have always said it, Diamond cant go below 1.09. My accumulation zone still stands at 1.09-1.50 until good news enter the market. If Diamond bank is put up for sale today in the market, na them go rush us! question you should ask is what price would Diamond bank be sold, considering its share of Nigeria retail market market?

n/b: Please not an advise for anyone to buy, unless you intend to loose your investment in this buhari era .

Dupeodus:
My post here is to launch a protest about what I consider a daylight robbery of retail investors of AIICO by AIICO's Management. AIICO announced that it will be doing a private placement of 4.4 billion shares to an undisclosed investor by private placement at N1.20 per shares and is planning an extra ordinary shareholders meeting to seek shareholders approval. Please do not be carried away by this proposed price of N1.20 compared to the market price. This is because I believe that AIICO's management has been manipulating its financial statement in the last 3 years to suppress the market price of AIICO's shares in anticipation of this private placement. First, the book value of the equity of AIICO as at 31-DEC-2017 works at about N1.58 per share. More importantly though is the fact that AIICO has about N12 billion hidden assets in the undervaluation of Federal Government bonds it holds as at that date. This N12 billion was shown as a negative reserve of the AFS assets in the equity section. Think about it. This is FGN bonds which is raw liquidity. Let me explain how I came about this.

In the 2016 financials, AIICO marked down the value of its treasury bills holding by about that N12 billion naira because they claimed interest rates increased and the face value of the FGN bonds has to be discounted. They disclosed the list of FGN holdings and over 90% of them by value were at about 12.15%. I can only guess that they used a prevailing 16% or thereabout interest rates for discounting because the list of many FGN bonds in the 2017 Financial statement was at 16% - 17%. This was fair enough as in that same year, the value of liabilities for life insurance and annuities were marked down for the same reason.

However, in the 2017 financial statement, the value of of liabilities for life insurance and annuities were now marked up by about N11 billion naira depressing the profit for the year. According to the Chairman's statement, this was because interest rates reduced by 12.9%. I believe this was a mistake in that he meant interest rates reduced to 12.9 percent which is used to measure the liabilities for life and annuity contracts. You will expect the same 12.9% to be used to measure the carrying values of the FGN bonds which should wipe off the N12 billion negative AFS reserves and show that the FGN bonds are being carried at cost. Alas, the N12 billion negative equities are still in the books. As I said earlier, as at 31-DEC-2017, about 80% by value of the FGN Bond holdings of AIICO were at 12.15% while the rest were at greater than 16%. At prevailing interest rates of 12.9% according to the Chairman's statements, these bonds should be carried at cost at least because the positive margin of about 3% on the 20% of bonds carried at 16% should be enough to offset the negative margin of 0.75% on the majority of the bonds. Therefore, instead of the value of N71.5 billion at which the Available for sale assets are carried in the books, it should have been at about N83.5 billion. Consequently, shareholders funds should have been at about N22.5 billion or about N3.25 per share instead of the N10.5 billion or N1.58 per share shown in the books.

The sole purpose of this private placement is for the management of AIICO to grab the company at the expense of retail shareholders. This is a very highly capitalized company with super liquidity. The company has about N83.5 billion FGN bonds at face value and N5 billion of Cash and Cash Equivalents to service N70 billions of Insurance and Investments contract liabilities. AIICO does not need the proceeds of this private placement.

I plan to write a letter of protest to both NAICOM and the SEC on this issue. If you can, please join this fight.

Dupeodus:
I just looked into the AIICO H1 2018 and realized that the shenanigans continues. First, about N10 billions of the AFS negative reserve have been charged against the Retained Earnings leaving only N2 billion, making the undervaluation of FGN Bond holdings less transparent. Secondly, there is a jump of N6.7 billions in Insurance Contract Liabilities. There are two issues I see with this. First, has interest rates of gone down so much within 6 months to warrant such a significant mark up in liabilities? Secondly, when you see this markup on this line, it is usually against the Gross Premium Written creating a negative gap between the Gross Premium Written and Gross Premium Income. However, the negative gap between the Gross Premium Written and Gross Premium Income in this statement is only N2.3 billions. I do see an increase of N4.9 billion in claims expenses btw half years 2017 and 2018

I firmly believe that this statement is cooked to the negative with the sole purpose of suppressing the market price of the shares so that these guys can buy the company on the cheap through the Private Placement.

Agbalowomeri:
Don't worry, she is no threat! You be my number 1 (as my school principal's daughter)

If she like let her ban me again

hyness:
how you take know you be winch?

Dupeodus:
My post here is to launch a protest about what I consider a daylight robbery of retail investors of AIICO by AIICO's Management. AIICO announced that it will be doing a private placement of 4.4 billion shares to an undisclosed investor by private placement at N1.20 per shares and is planning an extra ordinary shareholders meeting to seek shareholders approval. Please do not be carried away by this proposed price of N1.20 compared to the market price. This is because I believe that AIICO's management has been manipulating its financial statement in the last 3 years to suppress the market price of AIICO's shares in anticipation of this private placement. First, the book value of the equity of AIICO as at 31-DEC-2017 works at about N1.58 per share. More importantly though is the fact that AIICO has about N12 billion hidden assets in the undervaluation of Federal Government bonds it holds as at that date. This N12 billion was shown as a negative reserve of the AFS assets in the equity section. Think about it. This is FGN bonds which is raw liquidity. Let me explain how I came about...

stcool:
una funny no be small...Diamond bank @50k. that means GTB would be selling below N20. Well I have always said it, Diamond cant go below 1.09. My accumulation zone still stands at 1.09-1.50 until good news enter the market. If Diamond bank is put up for sale today in the market, na them go rush us! question you should ask is what price would Diamond bank be sold, considering its share of Nigeria retail market market?

Diamond stays above 1.09
GTB stays above N30-35
Zenith stays above N20....unless we are going back to 2008 financial crises. Election or not, banks will make profit. Shikena!

n/b: Please not an advise for anyone to buy, unless you intend to loose your investment in this buhari era .

Agbalowomeri:
I believe both statements in bold. There is no system you adopt that you wouldn't be dazed but you come out your coma from personal experience. However, it is good to have a grasp of FA and TA so you understand and smile (mischievously) when you see the faithfuls

Agbalowomeri:
27

Agbalowomeri:
I doubt if NSE is the place to look for more money to cater for responsibilities (IMHO)
I would rather think it is a place to improve returns on your SAVINGS

Otherwise you may be under pressure to trade ALWAYS which is a recipe for disaster

moneywoman74:
Agba, please what is full meaning of (IMHO)?

Also i need you to introduce me to an investment arm where i could be making more money.
All parts of my body needs money at the moment.

Northeastern:
Proprietary trading in which market?

There is no firm that is in profit year to date from prop trading.

moneywoman74:
Agba, please what is full meaning of (IMHO)?

Also i need you to introduce me to an investment arm where i could be making more money.
All parts of my body needs money at the moment.

stcool:
una funny no be small...Diamond bank @50k. that means GTB would be selling below N20. Well I have always said it, Diamond cant go below 1.09. My accumulation zone still stands at 1.09-1.50 until good news enter the market. If Diamond bank is put up for sale today in the market, na them go rush us! question you should ask is what price would Diamond bank be sold, considering its share of Nigeria retail market market?

Diamond stays above 1.09
GTB stays above N30-35
Zenith stays above N20....unless we are going back to 2008 financial crises. Election or not, banks will make profit. Shikena!

n/b: Please not an advise for anyone to buy, unless you intend to loose your investment in this buhari era .

Dupeodus:
My post here is to launch a protest about what I consider a daylight robbery of retail investors of AIICO by AIICO's Management. AIICO announced that it will be doing a private placement of 4.4 billion shares to an undisclosed investor by private placement at N1.20 per shares and is planning an extra ordinary shareholders meeting to seek shareholders approval. Please do not be carried away by this proposed price of N1.20 compared to the market price. This is because I believe that AIICO's management has been manipulating its financial statement in the last 3 years to suppress the market price of AIICO's shares in anticipation of this private placement. First, the book value of the equity of AIICO as at 31-DEC-2017 works at about N1.58 per share. More importantly though is the fact that AIICO has about N12 billion hidden assets in the undervaluation of Federal Government bonds it holds as at that date. This N12 billion was shown as a negative reserve of the AFS assets in the equity section. Think about it. This is FGN bonds which is raw liquidity. Let me explain how I came about this.

In the 2016 financials, AIICO marked down the value of its treasury bills holding by about that N12 billion naira because they claimed interest rates increased and the face value of the FGN bonds has to be discounted. They disclosed the list of FGN holdings and over 90% of them by value were at about 12.15%. I can only guess that they used a prevailing 16% or thereabout interest rates for discounting because the list of many FGN bonds in the 2017 Financial statement was at 16% - 17%. This was fair enough as in that same year, the value of liabilities for life insurance and annuities were marked down for the same reason.

However, in the 2017 financial statement, the value of of liabilities for life insurance and annuities were now marked up by about N11 billion naira depressing the profit for the year. According to the Chairman's statement, this was because interest rates reduced by 12.9%. I believe this was a mistake in that he meant interest rates reduced to 12.9 percent which is used to measure the liabilities for life and annuity contracts. You will expect the same 12.9% to be used to measure the carrying values of the FGN bonds which should wipe off the N12 billion negative AFS reserves and show that the FGN bonds are being carried at cost. Alas, the N12 billion negative equities are still in the books. As I said earlier, as at 31-DEC-2017, about 80% by value of the FGN Bond holdings of AIICO were at 12.15% while the rest were at greater than 16%. At prevailing interest rates of 12.9% according to the Chairman's statements, these bonds should be carried at cost at least because the positive margin of about 3% on the 20% of bonds carried at 16% should be enough to offset the negative margin of 0.75% on the majority of the bonds. Therefore, instead of the value of N71.5 billion at which the Available for sale assets are carried in the books, it should have been at about N83.5 billion. Consequently, shareholders funds should have been at about N22.5 billion or about N3.25 per share instead of the N10.5 billion or N1.58 per share shown in the books.

The sole purpose of this private placement is for the management of AIICO to grab the company at the expense of retail shareholders. This is a very highly capitalized company with super liquidity. The company has about N83.5 billion FGN bonds at face value and N5 billion of Cash and Cash Equivalents to service N70 billions of Insurance and Investments contract liabilities. AIICO does not need the proceeds of this private placement.

I plan to write a letter of protest to both NAICOM and the SEC on this issue. If you can, please join this fight.

onegentleguy:
For the most part, I agree with u.
...and to be honest, I had a similar line of thought sometime in April.
This also adds credence to my repeated view on the company.
Again, this shows the GROSSLY UNDERVALUED price of AIICO and the immense inherent upside OPPORTUNITY therein !!

Unfortunately in this country, retail investors are at the mercies of some of these company board and management 'wolves'.
Worse still is that the regulators that are saddled with the duty to protect have often paid lip service to these issues and are sometimes seemingly a part of the rot in the system.
However, in the midst of all this, lies OPPORTUNITY !! Crooked as it is, there is a reason why they have decided not to come for our money. ...instead, opting for a special placement at near 60% ABOVE market price.
So 1st, we will look to benefit/reap from that 'gap'.
There's even a 90% chance that the proposed special placement to an Investor might have direct links to these board/management wolves. (a not-too-different scenario played out in NEM before its fast rise in price giving over 200% ROI)
We will continue to look out for WAYS to benefit from the system.
If u can not beat them (the wolves of board members and managers alike), then look out for VALUE. ...and once u spot it, join them !!
The KEY is to try to ALWAYS apply WISDOM and swiftly align when u spot an immense VALUE/OPPORTUNITY, before they come for it.
...for often times, they will come for it. Applying every means within their power.
That is Nigeria for u. ...It is simply a portfolio country.

Like I always tell folks;
" The market will sometimes present a discerning investor with 'souvenirs'.
...often times, they are even 'bigger gifts' for lesser monies.
The problem however, is with knowing when to indulge it on an exchange.
...for therein lies ur pathway to success !!"