Sectoral Review: Dangote Flour Exits NSE-30, Consumer Goods Indices


The Nigerian Stock Exchange (NSE), on Monday, announced the results of the biannual review for its, and co-branded indices, effective from same day.
Highlights of the review showed that the banking, corporate governance, oil & gas, pension, and Afrinvest Bank Value indices remained unchanged, Dangote Flour Mills Plc exited the NSE-30 and the Consumer Goods indices, where it was replaced by Custodian Investment and McNichols respectively.
It was not immediately known whether the exit of Dangote Flour Mills has anything to do with the ongoing discussions for the acquisition of the balance of its shares in issue by Olam International for over N129bn (READ MORE).
SUNU Assurances Nigeria was replaced by Veritas Kapital Assurance Plc in the insurance index; just as Notore Chemicals Industry replaced First Aluminum in the industrial index.
Total Nigeria was replaced by Nigerian Aviation Handling Company in the Lotus Islamic index; just as Africa Prudential was admitted into the Afrinvest Dividend Yield Index, although none exited.
Also, African Prudential was admitted to the Meristem Growth Index, while Sterling Bank, Zenith Bank, and NAHCo Aviance were removed; while Access Bank, Presco and United Capital got admitted onto the Meristem Value Index, with none removed.
Explaining further, the NSE statement explained that the Insurance and Consumer Goods Indices are composed of the topmost capitalized and liquid companies in their specific sector, the Banking and Industrial Goods Indices comprise of the top 10 in their respective sectors.
The Oil & Gas Index has the top seven most capitalized and liquid companies in the sector, just as the NSE Lotus Islamic Index (NSE LII), consists of companies whose business practices are in conformity with Shari’ah Investment Principles, with the aim of increasing market breadth.
A statement by the NSE explained that the Lotus index creates an important benchmark for investments as the alternative ethical and noninterest investment space widened, assuring that companies thereon “have been thoroughly screened by Lotus Capital Halal Investment, in accordance with a methodology approved by an internationally recognized Shari’ah Advisory Board comprising of renowned Islamic scholars.
Meanwhile, the NSE further explained that in collaboration with Afrinvest Securities Limited launched the NSE-Afrinvest Banking Value Index and NSE-Afrinvest High Dividend Yield Index designed “in response to requests for applicable benchmarks for measuring value in banking stocks and high dividend stocks listed on the Exchange.
This was followed in March 2019, by the launch of the NSE-Meristem Growth Index and NSE-Meristem Value Index, in collaboration with Meristem Securities Limited.
These indices, it noted, provide a benchmark for the market to gauge the performances of value stocks and growth stocks listed on the Exchange.