To be able to hit the $1tn market capitalisation mark by 2016, the Nigerian Stock Exchange needs the full support of the Federal Government.
The Chief Executive Officer of the NSE, Mr. Oscar Onyema, stated this during a press conference on the market’s performance and 2013 outlook in Lagos on Thursday.
According to him, it is not impossible for the NSE, which currently has a market capitalisation of about N10tn, to reach the $1tn (150tn) mark by 2016, however, the support of the FG is needed in many ways to achieve this.
He said, “When we gave the target of $1tn market capitalisation in five years, it was an aspiration target. We were aware that a lot of things had to align to be able to achieve this, for instance; we depended on the regulation of the power sector and the quick passage of the Petroleum Industry Bill.
“And so, we need the support of government to ensure that the 16 companies that would come out of the power privatisation process would be listed on the NSE, and the same goes for the telecoms companies, we need government to assist in getting them to list their companies also.
“Government has to ensure that the right environment is there, and we appeal to the National Assembly to ensure quick passage of the PIB; because the oil and gas environment has generally been down owing to this. All these are the many drivers of the $1tn mark we plan to meet, we did not pull this figure from the air; it is achievable.”
Following his assumption in office in 2011, Onyema had said that the NSE was targeting a total market capitalisation of $1tn (N150tn) in five years, adding that plans were being put in place to achieve the target.
He had said that the Exchange was involved in various discussions with companies in the oil/gas, power and telecommunications sectors on the benefits of listing their shares on the NSE.
“Our goal is to grow our market capitalisation from $74bn to $1tn in five years. If we can attract the oil and gas sector, if we can attract the telecoms sector and power sector, then we should be able to hit those numbers,” he had stated, adding that with the ongoing plans to demutualise, those companies would be attracted to list on the Exchange, thus increasing the market value.
At the conference, the NSE boss also called on the Federal Government to grant tax incentives to companies listed on the Exchange as part of measures to attracting more firms to list on the NSE.
“We also use this opportunity to commend the Ministry of Finance for the pronouncement of the elimination of Value Added Tax, stamp duties,” he said.