₦airaland Forum

nna777:
I think the current devalued CBN exchange rate will bring some form of direction to the market. Currency speculators will now be scrambling to cut losses .

It is one thing to adjust / devalue, it is another thing to soak up pent up demand / supply market at that new rate.

If the latter does not follow the former, expect the situation to remain the same (if not worsened)

[quote author=mendes911 post=92551834]You and penny stocks toorrr.

#Bike......[/quote


hmmmmm this one wey Oge mendes don surface sooooooooo

Na only Agba remain wey we dey expect

Welcome Sir

BAMOFIN1:
Search his name on YouTube. I have more than 30 of his videos. You will learn a lot from him, though his investing rule is too conservative. I doubt whether a single stock on NSE can pass his test.

OK wld do

thank you

akinssan:
Check the attached...Great Rule to wealth.

hello Chief no attachment

kindly reattach

thank you

IYGEAL:
Also thanks to the person that recommended that Phil Town's book.

hello chief wld appr8 if u share d link for the Phil Town book

thank you

TLAX:
There is no bewilderment. The Fed money you were waiting for is not coming. The FPIs that are already inside are looking for ways out. The local players with financial muscle are doing siddon look. If the index can get back to January 2020 level before year end it should be considered a win.

One way of making money from stock investment i.e. dividend is still viable. Better in those that pay twice if bought at the right price.

My Oga i totally agree with u but nevertheless i think it wld come (i.e. Fed Money) though it wld be late and might not be much. The reasons are Meffy wld eventually resolve the FX issues (possibly b4 d year end), d printing is going to be on till 2022 (as guided by Powel), So my take is if Meffy solve d FX issues before end of q1 2021 some of it wld eventually find its way down.

DrAwo:
Annualised PE of 4.2
Gross ratio 51%
Net ratio 43%
Debt ratio 92%
Debt/equity ratio 1112% (yes! You read that correctly)
Annualised ROA 1.74%
Annualised ROE 21%
P/B ratio 0.89

My Oga

Nothing wrong with that ratio.

That is how an investment bank is supposed to run (high leverage) with occasional sell down of the levered products particular when the products had developed a life of its own

Na dem dey dull demself sinceeeee

Them just dey start d real business they were established to do

emmanuelewumi:
I only do FG bonds.

United Capital bonds offered about 12%, currently using the fund to buy some underpriced assets. I don't know when United Capital will push part of the over N10 billion raised into the stock market.

ok sir

emmanuelewumi:
I hope this bonds will perform sha?

N10 million will earn a total coupon of N10 million in 7 years.

If the Investor reinvest his coupons for 7 years at a conservative return of 10% should be able grow his coupons to N13.3 million at maturity.

Plus the invested sum, that will be N23.3 million. Not bad for investors who care concerned about the safety of their capital through fixed income Investment over a period of 7 years.

My Oga Tread carefully

Axxela is majorly the power / gas distribution arm of Oando (divested)

Even banks are now lending at lower rates (to corporates) than the coupon rate of 14%, so why is a supposed mid level corporate willing to borrow at 14% particularly in thsi ultra low rate environment we are in

emmanuelewumi:
Pray for the best, plan for the worst and prepare to be surprised.

Anything and everything is possible.

Unbundling of UACN businesses will unlock wealth for Investors, it will also show that the managers of UACN are shareholders centric.

Will UPDC support the unbundling at this time? Maybe in another 12 months or 24 months, just speculating.

After the unbundling the loser will be UPDC, the company will have to be independent. The company has no father ie UACN to run to when it has financial crisis, the unbundling will also put an end to the dividend of about N1 billion UPDC gets from his son UPDC REIT.

The revenue generated by UPDC in 2019 couldn't take care of the company's expenses. This is a disaster, if such a company is made to stand alone

I think the core Investors of UACN want UPDC to succeed post unbundling, considering the state of the economy and the real estate market, this may not be the right time to allow UPDC stand on its own.

That is why, I am against talking or predicting about market outcomes with 100% certainty, we will always be proved wrong again and again.

Always good, humble and intelligent to give room for that element of surprises and disappointments.

My opinion though

Boss UPDC predicament is of their own making.

They pioneered the upscale market (in the 90 and early 2000) but den became a dinosaur not extending to other part of the market (mid / lower mid e.t.c) despite a lot of nimble competitors (money bag one man developers) eating away at their cookie pie (upscale). These other markets (mid/ lower mid) had tremendous opportunities as exemplified by lekki garden commercial success / what happened in the osapa/Agungi / chevron corridor.

In summary their future success wld still require them leaving that upscale market into other markets with latent demand or else it wld continue to be a bottomless pit

GonFreecss1:
“Quantitative outright buying?”


Hahahahaha

My Oga i don dey think of d name since Oga Oracle mention am i cant even imagine any name for it

Dont mind dose pple if na third world dey do all dose printing that they are doing they wld say its unorthordox but if na dem dey do am dem go use big grammar dabaru us

las las God dey

RabbiDoracle:
We must still eat from the garden.

My Oga na my prayer be dat ooooooo

because wen d wahala come wether u eat oooo or u no eat ooooo u must contribute to d solution no matter hw smart u think u are

so make i kuku chop overful and carry some spare for head and pocket so dat wen the wahala come i go still get something to donate to the solution without injuring mysef with hunger

sellydion:
A company should be able to use its own inflow. However there could be problem if Items of import

are not included in HS code allowable for import by custom. Custom would deny the importation.

Thank you my Oga

That is why in my post i said Erisco get hin own issue which are in public domain

That news posted by Oga Obagadafi had been refuted by CBN as being a subtle / cheap blackmail . Even after that news Erisco had come out to praise present Govt (probably after he had been sorted out by the authorities). so wetin be my own

i beg make we leave grammar / academics and pray they solve present FX issues so that we all (NSE stalwarts) can have a fair share of all dis money wey powel & the gang are printing massively or else na only d wahala (hyper/ massive inflation) we go help dem solve without having eaten from garden when d wahala come

OBAGADAFFI:
IEW was established in 2017

https://www.cbn.gov.ng/out/2017/fmd/establishment%20of%20investors%27%20&%20exporters%27%20fx%20window.pdf

so y cant he sell hin own money to hinself via d window naaa (even in NSE cross deal is allowed / done)

onegentleguy:
U don't need to stress urself too much bro.
...u already put out a valid point, which I believe is a fact !!

The apex bank also confirmed some of these figures at the time, so anyone with doubt can argue with the CBN.
@ robobo also made some valid points though.
The important thing is that collectively, we all agree that there's need for the country(the current administration not necessarily the CBN alone) to allow for a unified Fx window peg, ease certain supply management regulations and allow for policies that can increase the believability index of our foreign brothers.(exchange rate clarity, confidence boost and greater capital inflow)

That said, I still think that the country's current surrounding Fx situation is still better than pre/post Jan 2018 and March 2020 period when we witnessed a market rally.(the CBN already adjusted/devalued twice)
Again, assets are currently cheaper(valuation in view) than they were then. ...so I still believe there'll be some rally in time. It(the rally) WILL BE SELECTIVE THOUGH.
For the most part, the prevailing circumstance(oil price strain and corona-induced environment)a have already been priced in on most assets/coys.
...so I expect the anti-fragileassets/WINNERS to reprise accordingly.

We continue to observe.

my Oga talking to the bold, in terms of practical value (PPP) of Naira present is better than those two era that u qouted however in term of free flow of FPI present is worse cos for those two era the FPI were able to completely go out (whether by design or accident) but now they are trapped in Naira assets unable to go out. i can say with some high probability of being right that the May / early June rally witnessed on NSE was a result of some FPI rotating back into equity after they cld not get USD upon sales done in March / April

but las las make dem just solve d problem so that we (NSE) can enjoy some of these high wall of liquidity on the global space

OBAGADAFFI:
https://businesspost.ng/economy/forex-crisis-erisco-foods-folds-sacks-1500-workers/?nonamp=1&amp=1

“My business has been deliberately frustrated by the way the CBN has managed forex bidding and allocation.
“They won’t give us forex to import machinery, machine spare parts and raw materials for processing Nigerian fresh tomatoes into paste in our Lagos factory and they won’t give us approval to use our own money (about $460,000) generated from our foreign operations to import our raw materials.

robobo
GonFreecss1
onegentleguy

My Oga make we leave matter for mathius, Erisco get hin own issue which is in public domain

i am not aware that CBN is stoping any exporter from selling proceeds of exports on the IEW since its inception in 2017, so why he cant sell hin own money to hin self via the IEW is what should be talked to as per Erisco

even the FPI / international DFI acknowledged that the IEW is free and functional market. The only issue with it is lack of depth / liquidity

but make we leave all dis grammar make we pray make dem solve d problem b4 all this global excess liquidity go dry up, so that NSE (indirectly me &u) can get its own share

OBAGADAFFI:
You are not going the bigger picture.

All these FX burden CBN is carrying is unnecessary if they had allowed owner of FX remittance to get their FX, not Naira.

Most Companies and individuals formally get their FX from various export businesses and other FX remittances.

But they are now forced to source FX through CBN form M or the black-market at higher rates.




Nigeria receives $17.5 billion diaspora remittances in 2019

https://nairametrics.com/2020/01/11/nigeria-receives-17-5-billion-diaspora-remittances-in-2019/#:~:text=Remittances%20are%20funds%20transferred%20from,source%20of%20much%2Dneeded%20funds.

Nigeria received $96 billion diaspora remittances inflow in 6-years
https://nairametrics.com/2019/10/11/nigeria-received-96-billion-diaspora-remittances-inflow-in-6-years/

My Oga i have told you to take all this remittance reports with a pinch of salt.

All the reports are resting on a survey / publication done by PWC which in itself had been questioned on the definition it ascribe to Remittance. For example the remittance reffered to by PWC in its report include non oil export proceed (and is even the largest contributor) which is outside the scope of Diaspora Remittance, and this non oil export proceed is even presently part of IEW market. the other leg of which could rightly be defined as Diaspora remittance (i.e. money sent by Chukwudi/ Adebola / Abdulrahman) as stated by Oga OGG via western union / moneygram e.t.c are not that big circa less than $5b annually, this also is currently on the table becos it is dollars proceed from such remittance that pre covid CBN channeled to BDC weekly sales / PTA / BTA. So on a bigger picture like you said all part of the remittance are already in the market place

But as a said in my last post why pre 2015 all the so called remittances werent able to stop / stall devaultions? why do the FPI catch cold once oil price go south, if the so called remittance is of such big impact on the FX plays in Nigeria

las las make we pray make dem (CBN) sort / solve the FX problem quick so that some of those global liquidity can find its way down to NSE, becos na thier my own garri dey

GonFreecss1:
You have said it all perfectly sir.

In Nigeria you can’t only be looking at Financial statements. Studying the economics of it all, is a must.

My Oga it is not only a must Sir. it shld even be d first thing b4 u start spreading / analysing financials becos it is the Macro that direct the flow of figures in those financials you want to spread / analyse.

That is why the NSE is not dancing to the global surplus liquidity fueled rally as Oga Rabbi had been expecting.

All said however i just pray dey find a solution to the FX debacle quickly becos na their (NSE) my garri dey. no be for all this grammar wey i dey blow since

OBAGADAFFI:
Diaspora remittance is one of the big sources on FX in Nigeria.

Pre-2015 CBN restrictions most Nigerians don't need CBN form M to get FX.

You get you FX from Western-Union etc, and trade it with anyone, so we have surplus FX in circulation.

Now Diasporans don't send much FX anymore, since the CBN is hoarding it.

These CBN restrictions created the current FX crises.

FX business is demand and supply.

What we are experiencing is a supply problem.

My Oga this Diaspora funds is overrated

Forget abt the futuristic figure qouted by PWC which was latched onto by politician to score cheap political points

werent the Diaspora remittance available before 2016? if so why was it not able to stop / stall all devaluations before then (i.e. b4 2016)

CBN placed restrictions in 2016 on remittances because it has become a black hole aiding all sorts of crime (laundering e.t.c.) however the CBN still designed another route for the same remittances inflow to reach retail end user by channeling all inflow via remittance to BDC weekly sales / PTA/ BTA.

Anyway we had both agreed on the fact that there is a supply (either through FPI / reduced oil receipt as I stated or via Remittances as u stated) problem which if not resolved wld continue to impact negatively on NSE

OBAGADAFFI:
The simple solution is for the CBN to ease the FX restrictions,, by allowing owners of FX remittance to get their funds in the foreign currencies and not Naira.

my Oga that soultion is not that simple

where is the FX to give them?

OMO maturity btw April and June was of $6b, if as data suggested that FPI constitute the bulk in that (OMO) market place up to as much as 60% then it can safely mean abt $3.6b want to leave d country (that is not counting other markets oooo e.g. Stock ) you wld be talking abt $4 - $4.5b that want to leave. the sales in IEW window btw same period was $900m -- $1b taking the two together you wld have a net of $3 -- $3.5b FPI funds trapped. THE $3.5b above excludes the need of other FX users (importers / fuel / debt service e.t.c)

My Oga if all above is taking together CBN wld need to find abt $10b, if u take $10b out of current reserve it wld give you $25b left of which some component of the remaining $25b is illiquid due to several factors e.g. swap lines / gold holding e.t.c) then you are looking at $15b liquid left which is barley able to cover 2 months of imports.

My Oga if above plays out (i.e. giving them the remittance as you stated) there wld be a massive run on the Naira and by then i doubt if anything of wld be left of the NSE that we currently play. so you see CBN is caught between two hard rocks and it is just doing its best till inflow (post covid / higher oil price) wld allow it to better manage situation

RabbiDoracle:
Maybe Meffy is holding back so that he will devalue once rather than doing it many times down the line. Meffy may have seen the handwriting on the wall about developed markets.

That is exactly what they dont want him to do hence d debacle, what they want is free float and Oga Buhari (not even meffy) is very abhorrent to that

on a purcahsing power parity d naira wld be fairly priced between 380 -- 420, considering that the Naira is already at the tail end of this spectrum, one wld have assumed that the FPI should be coming in by now but that is not the case which means they want more (Egypt 2016 comes to mind).

i think both party (Nigeria vs FPI) wld eventually settle for the middle ground i.e. a single rate for all markets but which is being managed by CBN by being the MM in that market.

Hw soon that wld happen is what i cant say because the CBN wld need a large war chest (circa 40 - 45b reserve) to effectively play MM for a single market which they dont currently have. i doubt if the FPI wld come in until that middle ground is achieved.

So this current consolidation might go on for a long time and even has a higher probability of spurring a downtrend if it lingers for too long (though not like that seen in March)

RabbiDoracle:
NSE seems disconnect from the global markets that has been bullish since April 2020. The reasons I do not know.

Some are making ATH right now.

Chief the reason is the FX debacle

DrAwo:
I download 5 years worth of annual reports from the companys website, extract the data I need and enter it onto a spreadsheet... From it, I calculate all the ratios and figures...

If you know how to use Microsoft excel, its pretty straightforward...

God Bless you plenty for sharing info from this your hardwork

Spreading financials no be easy work

DeRuggedProf:

Baba i dey gbadun u

God bless u plenty for all these valuable info u have been dropping

Hello my people

anybody been able to log on to Morgan Capital this morning?

im having some challenges loggin on

RabbiDoracle:
This market is not different from the ones we trade abroad

The same model (hunting mispriced companies with FA and TA) applied abroad will always work here at home.

You can't see a bull and call it a snake.

In the 2016, Nigeria entered recession and that was the time the bull started for banks. Is history about to repeat itself?

To d bold

ti aba ri Erin ki agba pa ri erin Ajanaku koja mo ri nkan fiiri

if we see an Elephant let us accept we see an Elephant.

An Elephant is not something we would say we saw in a jiffy

Heishere:
Well for one the recapturing exercise initiated by PENCOM which is a prelude to the transfer window coming soon.

All PFAs are mandated to recapture their customers' information in preparation for the transfer window. Any PFA that fails to recapture their customers' information within the stipulated time frame stands a chance of loosing the customer another PFA that successfully does that. Then the transfer window will give contributors the choice of porting from one PFA to another.

So imagine the effect of the above regulations on small PFAs and the ones with over-bloated customer base like Stanbic-IBTC pensions. The industry is going to be very competitive soon, so there will be mergers and more acquisitions.

Thanks appr8

Heishere:
I suppose they are running from the new regulations from PENCOM. Pension industry is most likely going to change next year.

Hello Chief

what are teh new regulations? and what are the changes being expected?

wld appr8 if you share ur insight

Tvegas:
https://nairametrics.com/2020/06/23/cbn-governor-confirms-exchange-rate-unification-plans/

Thanks appr8

TLAX:
Interesting Read.

Thanks appr8

RabbiDoracle:
The only thing that can derail the bull on NSE is if there is another selloff in the global world markets(US and EU combined). And that run will be stopped abruptly because Fed will start to buy stocks

Fed has entered one-way! Dem no fit go back.

So markets may stay artificially inflated for a while due to increased pumping. Maybe if investors lose faith in the dollar and fear to hold dollar debt, na that time the main oso Abiola will happen.

Everyone is looking for which country will be safe to hold their hot money till the crisis in the US abates. They know that the US and EU stock markets are running faster than the economic recovery and this is an anomaly.

Chief i totally agree with ur postulation (Fed printing / hot money) but the last leg of it (i.e. the flow towards emerging market a la i.e. NSE) is what other commentators are calling attention to. Considering the peculiarity of the regulatory environment of NSE (i.e. CBN FX regime) dont u think the inflow would be late in coming (if at all it come) because the FPI might want to give attention first to other emerging market ( e.g. Turkey / Egypt e.t.c) without the type of CBN FX regime isue but with similar return to NSE (rsik / reward). Also that when they eventually come in what wld be left wld be crumbs (other markets having eating to satisfaction before they look at the side of NSE) hence this crumb might not be much to spectacularly move NSE.

I would appreciate your take on above

Tvegas:
This session was organized to help calm the nerves of foreign investors now awash with bailout dollars but worried about Nigeria’s faltering economy and its likely ability to trigger further devaluation. Mr. Emefiele did not confirm if another devaluation was in the offing.

Rabbidoracle, The above is from Nairametrics write up on a recent CBN event where fx issues were discussed. Even though i pray for the inflow of those free foreign funds there by leading to a massive bull. However, there is too much uncertainty in this market for that bull to happen anytime soon. The CBN is living in denial hence a second round of devaluation is inevitable. I also see the current sideways trades happening for a while.

Hello Chief

kindly avail a link to the said write up.

Thank you