RateCaptain
  • FX Rates
  • Commodities
  • Money Market
  • Cryptocurrency
  • Corporates
  • Contact Us
No Result
View All Result
Subscribe
  • FX Rates
  • Commodities
  • Money Market
  • Cryptocurrency
  • Corporates
  • Contact Us
No Result
View All Result
Rate Captain
No Result
View All Result
Home Banking

MTN Nigeria now more valuable than all Nigerian Banks combined

Rate Captain by Rate Captain
May 23, 2022
in Banking, Business, Markets
Reading Time: 3 mins read
A A
0
MTNN Share Price gains 1.21% after CBN granted the final approval of its MoMo PSB
Share on FacebookShare on TwitterShare on WhatsappShare on Telegram

is now worth N5 trillion making it more valuable than all banks, insurance companies, and the entire financial services companies listed on the Nigerian Stock Exchange combined.

This is according to market valuation data as of May 20th, 2022, tracked and compiled by Nairametrics from the Nigerian Exchange.

AlsoRead

The mother of all economic crisis may be on its way

Fuel Scarcity Bites Harder in Lagos, Petrol Now Sells for N180 per Lite.

E-commerce: Amazon to compete with Konga, Jumia as it expands to Nigeria in 2023

As of Friday, MTN Nigeria closed with a total market capitalization of N5.068 trillion making it the third most capitalized stock on the Nigerian Exchange. MTN Nigeria now joining Airtel and Dangote Cement, all members of the SWOOT to be worth more than the financial services sector.

MTN was briefly the most capitalized stock two weeks ago when the share price was trading at N264 per share valuing it at N5.3 trillion. However, Airtel and Dangote Cement prices have since risen while MTN shed some of its gains.

MTN Nigeria belongs to a category of companies termed SWOOTs by Nairametrics which means Stocks Worth Over One Trillion Naira. Other members of the group include Airtel Africa (N5.5 trillion) Dangote Cement (N5.1 trillion), BUA Cement (N2.5 trillion), Nestle (N1.1 trillion), and BUA Food (N1 trillion).

Shares of MTN have been on the rise since the beginning of the year starting from about N197 to as high as N270 last week.

The share spike which is also largely driven by MTN’s blistering 2021 FY results and 2022 first-quarter results took it past N5 trillion during the week joining Airtel and Dangote Cement as the only three stocks worth over N5 trillion in Nigeria.

The entire Nigerian Financial Services sector which includes banks, insurance companies, and other financial institutions is valued at a combined N4 trillion.

With an over N1 trillion gap between MTN’s valuation and that of Financial services companies, the telecom giant is now firmly more valued than all of them and will have to experience a 20% dip in share price to fall below.MTN’s share price has risen 51.38% in the last year.

While Airtel, valued at over N5.5 trillion is also more valuable than all the financial services firms, MTN is more significant as the company’s financials represent income generated from Nigeria alone, excluding other African countries.

Airtel’s income includes that of other sub-Saharan African countries even though the income of Nigeria is dominant with about 40% of revenues.

Why are telcos more valuable

A combination of factors explains why MTN and even Airtel are more valuable than the Nigerian financial services sector including banks.

While banks have been declaring impressive profits telcos have gone further by not just declaring profits but achieving double-digit growth projections for other sectors of their market, especially data.

With over 199 million active mobile subscribers, telcos have the customer base and demand that will continue to drive up revenues and profits in years to come.

Apart from data, Telcos also have the capacity and funding to veer into other sectors of the economy starting with banking. The recent MOMO license obtained by MTN opens up a new source of revenue for the organization.

Asides, from their growth prospects, telcos also have better control of their margins and returns. Unlike the financial services sector, Telcos deliver over 100% return on average equity of about 20%. MTN reported a return on average equity of 134% in 2021.

Apart from fundamentals, Nigerian banks also have billions in shares trading with much higher liquidity when compared to telcos.This is due to the high proportion of single owners of the shares of the banks compared to telcos. For example, Zenith has about 643, 965 shareholders compared to MTN’s 10,931 as of the end of 2021. Also, whilst 2 shareholders own 15% of Zenith Bank, one shareholder owns 76% of MTN.

The shift in the size of Nigeria’s economy

We are also not surprised that MTN has now eclipsed the entire financial service sector in market valuation.According to Nigeria’s GDP data, the telecommunications sector had a nominal GDP of N14.1 trillion as of December 2021 compared to N5.3 trillion for the entire financial services sector 10 years ago (2021), Telecommunication Sector has a nominal GDP of N5.3 trillion while banks had a GDP nominal size of N1.49 trillion.

This was not the case before the advent of Telcos.Telcos are also now 12.6% of the country’s GDP.

Previous Post

Tether, USDT market cap has dropped by US$10B since UST collapse

Next Post

Crude oil hit $111 a barrel amid weak dollar and OPEC’s stance to aid Russia

Related News

The mother of all economic crisis may be on its way

The mother of all economic crisis may be on its way

by Rate Captain
June 23, 2022
0

Going by the data from the National Bureau of Statistics Nigeria’s inflation rate for the month of May stands at...

Fuel Scarcity Bites Harder in Lagos, Petrol Now Sells for N180 per Lite.

Fuel Scarcity Bites Harder in Lagos, Petrol Now Sells for N180 per Lite.

by Rate Captain
June 22, 2022
0

Fuel scarcity worsens in Lagos state as more filling stations shut their pumps to motorists and other customers. This persisting...

E-commerce: Amazon to compete with Konga, Jumia as it expands to Nigeria in 2023

E-commerce: Amazon to compete with Konga, Jumia as it expands to Nigeria in 2023

by Rate Captain
June 21, 2022
0

American e-commerce giant, Amazon, is set to disrupt the Nigerian e-commerce market as it plans to launch in the country...

Defi protocols declined by $124 billion in 6 weeks.

Defi protocols declined by $124 billion in 6 weeks.

by Rate Captain
June 21, 2022
0

The total value locked (TVL) on ethereum, a metric that attempts to track the value of tokens deposited in a...

Next Post
CBN say Nigeria would reap the benefits of a rising oil price

Crude oil hit $111 a barrel amid weak dollar and OPEC’s stance to aid Russia

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Recommended

Why Bitcoin investor are  under water

Why Bitcoin investor are under water

June 23, 2022
What caused Celsius Price Skyrockets by 400%.

What caused Celsius Price Skyrockets by 400%.

June 23, 2022

Popular Story

  • Interpol, Kenya Government Probe Three Nigerian Fintech Tycoons over N128 Billion from Nigeria

    Interpol, Kenya Government Probe Three Nigerian Fintech Tycoons over N128 Billion from Nigeria

    0 shares
    Share 0 Tweet 0
  • Market Capitalization Of Tier 1 Banks Depreciate By 2%

    0 shares
    Share 0 Tweet 0
  • Bitcoin Whale Moves Over $600,000,000 in BTC

    0 shares
    Share 0 Tweet 0
Rate Captain

RateCaptain

We bring you the most accurate in new and market data. Check our landing page for details.

  • FX Rates
  • Commodities
  • Money Market
  • Cryptocurrency
  • Corporates
  • Contact Us

Copyright © 2022 RateCaptain - All rights reserved by RateCaptain.

No Result
View All Result
  • FX Rates
  • Commodities
  • Money Market
  • Cryptocurrency
  • Corporates
  • Contact Us

Copyright © 2022 RateCaptain - All rights reserved by RateCaptain.