Transcorp Plc (“TRANSCORP” or the “GROUP”) is progressively attaining a behemoth status in Nigerian business landscape.

With strategic investments in key segments of the economy, the group has positioned itself as a pivot in the impending economic transformation of the country while touching lives and contributing positively to building prosperity.

Transcorp Group, as a leading conglomerate, has strategic investments in the power, hospitality, and energy sectors, with its power business accounting for over 20% of Nigeria’s installed power capacity. Similarly, the hospitality business – Transcorp Hotels Plc owns the iconic Transcorp Hilton Abuja, Nigeria’s flagship hospitality destination, and has launched digital platform Aura by Transcorp Hotels.

Brief on Nigeria energy story

The Power (Energy) industry in Nigeria is very important in the drive for a total industrialization of the economy. The country has systematic challenges with adequate power generation and distribution to serve its over 220 million population. According to latest available data from the Nigerian Bulk Electricity Trading Plc (NBET), of the total installed capacity of 13,461 megawatts (MW) and available capacity of 6,885 MW, only an average of 4,022 MW was generated and distributed through the national grid in 2021. This leaves a big hole for the existing players in the industry to scale up capacity and fill.

With an installed capacity of 1,938 MW, Transcorp Power Plc, the largest gas-powered generating station in the country, is poised to take advantage of this yeaning gap. As such, we expect the Power unit to continue to dictate the Group’s revenue mix.

Brief on Nigeria hotel business story

Hotel development in Nigeria is concentrated in major commercial and administrative centres, led by Lagos and Abuja, the immediate past and current federal capitals respectively. Lagos, the nation’s economic nerve centre, accounts for the bulk of upscale hotels and international brands in the country. It is a global business hub and home to Nigeria’s busiest international airport, seaports, and numerous corporations, driving consistent business travel. Abuja, the capital, on the other hand, is the second key market. As the seat of government and foreign embassies, Abuja sees steady demand from government functions, conferences, and diplomats. It hosts several top-tier hotels catering to official delegations and business travelers.

The government has shown commitment to tourism development through policy measures. For example, visa facilitation has improved – Nigeria introduced a Visa-on-Arrival system and in 2024 expanded visa-free entry to 17 African countries (ECOWAS and others) to boost regional travel. Tourism promotion and infrastructure have also been on the agenda, though execution remains gradual. Overall, the macro environment offers opportunities for hotel growth (rising urbanization, a growing middle class, increasing business travel) alongside risks like currency devaluation, high inflation, and security issues that stakeholders must navigate​. The industry continues to evolve as its contribution to the overall GDP in 2024 stood at 0.74%, higher than 0.73% recorded in 2023.

FY-2024 Financial Performance Review

TRANSCORP recently released its audited financial statements (AFS) for the year ended December 2024 (FY ’24) to the market. A quick analysis of the results shows that revenue (topline) and net income (bottom-line) climbed by triple digits amid capacity improvements and price actions in two of its major business lines (Power and Hospitality).

Power unit drives top-line expansively

Top-line for the year, for example, jumped by 107.1% y/y to ₦407.92 billion in FY ‘24, compared to ₦196.99 billion achieved in FY ’23. As noted above, the sturdy growth in the top-line was chiefly driven by improved performance of the Power and Hospitality lines. For the Power unit, revenue grew by 117.2% y/y to ₦337.78 billion, following the coming on stream of its 240mw Afam-3 fast power plant within the year under review. Note that the Power unit contributed 82.8% to the total Revenue. The Hospitality unit grew by 69.2% y/y to ₦70.13 billion, and contributed 17.2% to the Revenue.

Source: Transcorp Plc FY-2024 Data

High energy prices and Naira devaluation builds up costs

However, the upsurge in global energy prices and currency devaluation negatively impacted FY ’24 Cost of goods sold (COGS), which flipped over by 141.6% y/y to ₦212.25 billion, higher than the growth rate posted by the top-line. Operating expenses (OPEX) also saw an expansion of 105.5% y/y to ₦62.85 billion, thereby cutting margin returns by 4.8 percentage points. Nonetheless, Operating Profit grew by 83.0% y/y to ₦149.04 billion due to the robust topline growth. Elsewhere, Net finance costs dropped by 22.5% y/y to ₦16.72 billion, following liquidation of FX tied loan in the prior year.

Source: Transcorp Plc FY-2024 Data,

Bottom-line rises by 233.8% y/y

The Company posted a pre-tax profit of ₦42.58 billion, representing a growth of 132.4% y/y. After accounting for income tax expenses, which summed up to ₦42.58 billion (combined effects of income, tertiary education, police, capital gain, and under provision taxes), the profit after tax (bottom line) settled at ₦94.09 billion, representing a growth of 188.3% y/y, compared to FY ’23 number.

Source: Transcorp Plc FY-2024 Data,

Note: From the reported PAT above, earnings attributable to the owners of the company or equity holders stood at ₦51.52 billion, resulting in an EPS of ₦5.07 kobo, compared to ₦0.40 kobo achieved in FY ’23. Non-controlling interest portion of the PAT represents the balance of ₦42.56 billion. Furthermore, the EPS differs from the ₦1.45 kobo reported by TRANSCORP in their AFS document, which we imagine must have come from using the old outstanding number of shares (pre-reconstruction data) for their computation.

Dividend income to reward shareholders

The Board is recommending a final dividend of ₦0.60 per share to shareholders whose names are on the company’s registers at the close of business on 25 March 2025. At the closing market price of ₦47.00 posted on Wednesday, 19 March 2025, dividend yield (DY) stands at paltry 1.28%.

Note: The company had earlier in the course of 2024 paid an interim dividend of ₦0.10 per share to shareholders, which when adjusted to the old outstanding number of shares, sums up at ₦0.40 per share. This brings the total divided that will be paid in FY ’24 to ₦1.00 per share.

Net asset continues the upward trend

Total assets (TA) rose by 41.8% y/y to settle at ₦751.56 billion. Growth here was chiefly supported by Trade and other receivables, which grew by 119.0% y/y and represents 42.7% of the TA. Markedly, the Trade and other receivables constitute 92.8% of total Current Assets (CA). The CA grew by 101.6% y/y, marking the Group’s business structure, especially the Power unit, where the bulk of transactions were done on a take-or-pay basis. On the liabilities side, total liabilities (TL) rose by 40.2% to ₦377.12 billion. The growth here was helped by trade and other payables, which grew by 55.6% y/y and represented 58.6% of the total TL. With the faster increase in TA compared to TL, Shareholders’ fund rose modestly by 45.1% y/y to ₦271.69 billion.

Valuation

Using the sum-of-the-parts valuation (SOTP) and relative valuation methodologies (RVM) we arrive at a target price (TP) of ₦57.45 per share. Our TP here reflects a lower net debt position, improvements in capacity utilization for its power plants following a ramp up in export capacity, increases in the ADR (average daily income rate per room) for the hotel business. At our TP, TRANSCORP currently carries an upward potential of 29.4% when compared to the closing market price of ₦44.40 per share posted on Friday, 11 April 2025.

Based on the above valuation and the compelling business case for the company, going forward, we place a BUY rating on the company’s shares at the current market price of ₦44.40 per share.

Note: Our TP here has been forecast for a period up to twelve months (12M-TP). Therefore, it covers period up to March/April 2026. However, the 12M-TP is amenable to periodic adjustment as earnings and sensitive Group’s information, or data unfolds.

Kindly see the table below for the company’s detailed FY ‘24 AFS performance highlights.

Source: Transcorp Corporation Plc FY ‘24 AFS Data,

About TRANSCORP Plc

Transnational Corporation Plc (Transcorp Group) is a diversified conglomerate with strategic investments in the power, hospitality, and energy sectors. Owners of Transcorp Power Ltd, TransAfam Power Ltd, Transcorp Hotels Plc, and Transcorp Energy Ltd. Transcorp Group is committed to creating value and socio-economic impact by improving lives and transforming Nigeria through its business operations and initiatives. Over the years, the Transcorp Group has shown consistency in growth and innovation. In 2020, Transcorp Group fully acquired TransAfam Power Ltd, increasing its power play in the industry, and generating capacity. In 2021, the group launched Aura by Transcorp Hotels, through its hospitality business, Transcorp Hotels Plc.