Analyst Tasks FG on Listings on NGX to Boost Tax Revenue

L-R: Vice Chairman, Capital Market Correspondents Association of Nigeria (CAMCAN), Mr Friday Ekeoba; Managing Director/Chief Executive of Arthur Steven Asset Management Limited, Mr Olatunde Amolegbe and Chairman CAMCAN, Chinyere Joel-Nwokeoma during the CAMCAN Review of 2023 Market Performance and Outlook for 2024 in Lagos Today

Capital market analyst, the Managing Director/Chief Executive of Arthur Steven Asset Management Limited, Mr. Olatunde Amolegbe  has urged the Federal Government to actively promote listings on the nation’s bourse, emphasizing the positive impact on capital market participation and tax revenue generation.

During the Capital Market Correspondents Association of Nigeria (CAMCAN) January forum in Lagos, themed “Review of 2023 Market Performance and Outlook for 2024,” Amolegbe highlighted the importance of encouraging companies, particularly those with direct or indirect government holdings, to list on the market. He stressed that this move would not only deepen the capital market but also enhance transparency, ultimately boosting tax revenue in the country.

Amolegbe expressed concern over Nigeria’s market capitalization to GDP ratio, which stands at 13%, significantly lower than the over 50% observed in many other countries. He noted that a majority of the country’s major companies are not actively participating in the Nigerian capital market.

As a former President of the Chartered Institute of Stockbrokers, Amolegbe emphasized the role of the capital market in ensuring transparency for listed companies and asserted that increased listings would contribute to higher tax revenue for the government.

The CEO expressed optimism about the potential listing of Dangote Refinery and NNPC Limited, anticipating a positive impact on the capitalization of the Nigerian capital market.

Amolegbe also addressed the pressing issue of insecurity in the country, highlighting its impact on inflation and investor confidence. He urged the government to address insecurity, emphasizing its disruption to the supply chain, hindering agricultural production, and impeding market access for farmers.

In relation to the 2023 market performance, Amolegbe noted that the All-Share Index closed the year at 74,773.77 points, with the market capitalization reaching N40.918 trillion. He identified key events influencing the market in 2023, including a smooth transition of government, the president’s inaugural speech, the enactment of partial removal of subsidy, the unification of foreign exchange, and an increase in the monetary policy rate.

Looking ahead to 2024, Amolegbe emphasized the significance of foreign exchange stability for the capital market, predicting potential challenges for quoted companies if liquidity does not improve and prices remain volatile.

January 24, 2024