Friday October 02, 2020 / 10:45 PM / by
NASD Plc/ Header Image Credit: NASD Plc
COVID-19 Impact Series: Transport Sector
No matter the circumstance, transportation is essential in daily life, especially with economic activities. As a result of the lockdown placed by governments, non-essential firms and service providers have either been restricted to working remotely or witnessed reduced attendance in workplaces. Consequently, this has resulted in sudden changes in sources of revenue. Therefore, there has been a decline in the turnover in the transport industry. Although, this sector assists in the movement of people, goods and essential workers, it has still been crippled by the current climate. Below, we examine the sector into three main parts: road, water and air transportation.
For road transportation, it is the most popular and is commonly used by the business community in most countries. This pandemic coupled with the global oil prices has resulted in higher fares which have made for an increased cost of transportation. In developed countries, that have well-organised road systems, the impact of these has been bearable. However, in the case of countries like Nigeria, there are concerns about mass congestion in vehicles as drivers might not respect health protocols. This may result in another major wave of the virus outbreak and would endanger human beings. Besides, these drivers face reduced trips as a result of the lockdown and this decreased their revenue.
Given the fact that air transport is widely considered as the fastest means of transport, one could make a strong argument that this sub-sector has been affected the most. It should be noted that it cost airlines, airports and even ground-handling service providers dearly to keep afloat without the pre-pandemic traffic of business activities. This is evident as the global air traffic has declined significantly since the second quarter of 2019. Therefore, the international governing bodies have called on respective governments to create and implement policies that can support air travel through this trying period and post-pandemic.
When considering international trade and the exchange of commodities, transportation is needed in most cases and water transport is the means most used to achieve this purpose. The virus outbreak also affects sea travel as the global demand for some commodities have declined as a result of a plethora of reasons, the main one being the reduced income for individuals. Another effect is that there have been disputes in the settlement of transactions as orders have been delayed in meeting their delivery locations and so on. In other words, the uncertainty as a result of the pandemic has caused some inefficiency of operation within the shipping and maritime industry.
Overall, there has been reduced investment in the transport sector as a result of the reasons mentioned above. Notwithstanding, NASD will continue to play its role in providing suitable platforms to attract capital into the various sectors of the economy. The NASD Enterprise Portal along with the Venture Ramp can contribute to improving investor's confidence in the transport sector as a whole and especially in the sub-sectors that need it the most.
NASD OTC Securities Exchange Market closed on a positive note YTD as the market recorded an increase in performance. NASD Security Index Year to date return rose by 5.28%. Total volume traded Year-to-Date stands at 7,841,321,350 units in 1208 deals and total Value traded is N11,372,168,194.83.
Week 40 Overview
NASD OTC Securities Exchange closed the week with a positive return on NSI. The NSI return rose by 0.25% to close the week at 734.39 points against 732.57 points against preceding Friday, September 25 2020.
In addition, Week 40 saw NASD Investors gain N1.34 Billion in value. NASD OTC Market capitalization closed at N539.46 Billion compared to N538.12 Billion in the preceding Friday, resulting from a positive movement of prices.
There was a 1,783.12% increase in the total value traded during the week as week 40 saw NASD Investors trade a total of N490,219,668.44 in value compared to N26,032,353 in the previous week. Total trade activity for the year is valued at N11,372,168,194.83.
In a different pattern, volume traded during the week was 2,326,164.00 units compared to 12,196,894 units in the previous week leading to a -80.93% decrease in trade volume compared to week 39. Total volume traded for the year is 7,841,321,350 units.
Top Traded Securities by Volume
The week closed with Niger Delta Exploration and Production Plc ranking top among five most traded securities by volume and UBN Properties Plc as the fifth most traded stock by volume traded in week 40.
Top Traded Securities by Values
The week closed with Niger Delta Exploration and Production Plc ranking top among five most traded securities by value and UBN Properties Plc stood as the fifth most traded Security by Value for the week.
Advancers for the week
One of NASD OTC stocks closed the week with a positive movement in price. FrieslandCampina Wamco Nigeria Plc, which currently holds a Market Capitalization of N137.16 Billion closes the week at N140.49 representing a 2.17 percent increase from the previous close of N137.5.
Decliners for the Week
Two of NASD OTC stocks closed the week with a drop in the value of their Securities. Niger Delta Exploration and Production Plc, which currently holds a Market Capitalization of N56.58 Billion closes the week at N311.94 representing a -0.14 percent decrease from the previous close of N312.38.
Central Securities Clearing System Plc, which currently holds a Market Capitalization of N72.5 Billion closes the week at N14.5 representing a -2.03 percent decrease from the previous close of N14.8.