Top 30 Companies in Sub Sahara Africa (ex SA): UBA In/Unilever Out

Proshare

Friday, April 22, 2016 2:35 PM / Christopher W Hartland-Peel

This report is an update as of March 2016 and covers the Top 30 companies in Sub-Sahara Africa ex SA by market capitalisation. 

Twelve Nigerian firms made the list topped by Dangote Cement (1), Nigerian Breweries (3), Nestle Nigeria(5), GTBank (7), Lafarge Africa (9), ETI (10), Zenith (11), Forte Oil (12), Guinness Nigeria (22), Stanbic IBTC (23), UBA (28) and First Bank (29)


Key Highlights: 

·                   A few green shoots and year to date six markets have positive US$ returns (page 5). 

·                   SSA ex SA stock markets rose 3.5% in March 2016 (page 5) as commodity prices started a recovery.  Also, currencies appreciated, led by South Africa (page 2). 

·                   Market capitalisation of the Top 30 companies for March 2016 was US$60.5bn, up 3% on February but down 6% year to date. 

·                   Nigerian manufacturing companies rose but Nigerian banks fell (page 3).

·                   Historic P/E’s, Price/book ratios are near multi-year lows and dividend yields are rising.

·                   Strong earnings resilience and to date 17 companies have reported their December 2015 full year results. 

·                   Earnings down a modest 6% in US$ terms to US$3.6bn, notwithstanding 2015 currency weakness. 

·                   Share prices, in aggregate, are now at their level of August 2012 in US$ terms. 

·                   The stock market events were (i) a continuing recovery in Nigeria and Kenya (page 3) and (ii) Rand appreciation which helped regional currencies in southern Africa and their markets. 

·                   New Entrants:  Bank of Windhoek, UBA. 

·                   Departures:  Tanzania Cigarette, Unilever Nigeria. 

·                   Analysis Shows:

o   10 companies with a ROE > 25%.

o   12 companies with a trailing P/E < 10.0 times.

o   12 companies with a dividend yield > 5%.

o   8 companies with a price/book value < 1.50 times.

·                   Kenyan and Nigerian inflation and interest rates (page 10) - Kenya has positive real interest rates of 1.8% and Nigeria’s real rate is a negative 6.5%.



Sources: Country Stock Exchanges, company annual and earnings reports. Exchange rates from the Financial Times, London



The author: Christopher W Hartland-Peel specialised in SSA ex SA markets and companies since 1990 with data and financials going back 25 years. Country and sector analysis, SSA ex SA and regional US$ market indices from 1990., www.hartland-peel.com 1 High Silver, Loughton, Essex IG10 4EL, UK; Tel: +44 (0) 208 502 0102

 

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