Monday, March 09, 2015 8:20 AM / TheAnalyst
The IPO market in the Nigerian Capital Market is gradually witnessing some improvement after the market witnessed some dead sessions due to situations attainable in the market environment as a result of the 2008 market downturn and its extended downtrend.
A few issuers that wanted to engage the market in terms of capital raisings via the IPO window could not do so as the idea has to be shelved due to low investors’ confidence and sentiment in the market while the market regulators such as the Nigerian Stock Exchange led by Oscar Onyema has been striving to put the market back on a positive track by pushing forward key initiatives and reforms.
During the 2006 banking consolidation, IPOs were the toast of the market as a lot of banks that were striving to meet the new bank re-capitalization deadline set by Charles Soludo, the then CBN Governor, led their management to the stock market to meet their capital requirement needs while a few non-banking firms followed suit.
Thus, the banking consolidation was responsible for the huge number of IPOs in the market then with sixty-two (62) IPOs recorded in 2006, five (5) in 2007 and a further increase to twenty-one (21) in 2008.
Between 2009 and 2012, the IPO market was completely dead while the market witnessed six (6) IPOs between 2013 and March 2015.
A brief look the performance of 50 stocks listed between 2008 and now reveals that six (6) currently trade in the green zone while another forty-one (41) trade in the red zone and the remaining three (3) closed flat.
1.Nigerian Stock Market and the State of IPO’s
2.Capital Markets and IPOs in 2012 – An Opening?
3.IPO in Nigeria: 2008 to 2015
4.Will there be a revival in the IPO market soon?
5.Why Right-Issues dominate the primary market - Investors pause on IPOs
6.Nigerian Bourse fails to inspire Primary Market Activities in 2013