Retail views

UBA Q4 results

Nigeria

Thursday, 07 May 2015

Daily Retail Report .

Market Review

The Nigerian Stock Exchange continues its losing spree against the backdrop of weak investor sentiments. All-Share-index dropped by 8bps to return 34,400.48bps. NSE sectorial indices showed mixed performance, as NSEINS and NSECNSM closed negative while NSEBNK, NSEOILGS, and NSEIND closed in positive terrain on the back of ETI(+10.17%), FIDELITYBK (+2.66%), CAP (+4.99%) and ASHAKACEM (+2.66%) The decliners beat advancers in a ratio of 5:4 while 66 issues

remained unchanged. Among broad indices 330million units of

shares valued at N3.750bn exchanged hands representing a 30%

decrease in volume traded but a 9% increase in value traded

relative to the previous session. The key stocks in the gainers’ chart

are ETI (N24.55), CILEASING (N0.60), and FIDSON (N3.15) while

UNITYBNK (N2.75), ABCTRANS (N0.57) and GUINNESS (N160.56)

led the losers’ chart.

Nigeria Ropes Plc released their FY 2014 result for the year ended

31st Dec. 2014. Revenue (N374.1bn) appreciated by 2% while PAT

(N204.9mil) depreciated by 8% from prior period.

We expect value investors to take position in defensive stocks, as

their prices currently look attractive in the face of recent weak price

movements.

Sector Report Today(%) Month-To-Date(%) Year-To-Date(%)

NSE30 0.05 -0.46 66.39

NSE BNK10 1.39 3.01 113.21

NSE CNSM10 -1.02 -2.42 54.52

NSE OILG5 0.44 0.54 103.46

NSE INS10 -0.36 -0.51 4.90

NSE IND 0.55 -0.24 4.11

Market Wrap

ASI -0.08 34,400.48

Index year-to-date e -0.74

Market Cap. N11.682Tril

Traded value 3.750Bn

Key gainers (%)

ETI 10.19

CILEASING 7.14

FIDSON 5.00

CAP 4.99

HONEYFLOUR 4.99

Key losers (%)

UNITYBNK -9.54

ABCTRAMS -5.00

GUINNESS -4.99

CCNN -4.55

NASCON -4.36

NITTY

1M 10.7087

2M 10.7419

3M 11.2088

6M 12.3412

9M 14.4658

12M 14.8309

Crude oil spot price

Brent crude US$66.89

Contact information

Phone: 01-2713923; 01-2713920

Mobile: 08068015502

Email: cslservice@fcmb.com

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Stock Recommendations

Banking Comment

Current

Price

Target

Price

Potential

Upside %

EPS

FY

2014

1 Yr

forward

EPS

Last

Dividend

(N)

P/BV

2014

Yield FY

2014

Yield FY

2015e

Shares

Outstanding

(millions)

Year

End

ACCESS BANK Buy 5.99 7.33 22% 1.90 0.40 0.60 0.70 9.19% 0.8% 22883.00 Dec.DIAMOND BANK Buy 4.65 5.27 13% 1.54* 0.30 0.10 0.43* 7.5*% 1.8% 14475.00 Dec.FIDELITY BANK PLC Under review 1.93 1.86 -4% 0.45* 0.33 0.18 0.22* 10.8*% 6.9% 28974.00 Dec.FBN HOLDINGS Buy 8.93 12.86 44% 2.54 0.04 0.10 0.58 1.10% 0.0% 32632.00 Dec.GUARANTY TRUST BANK Buy 28.83 28.42 -1% 3.40 2.10 1.75 1.90 7.20% 7.3% 29431.00 Dec.STANBIC HOLDINGS Hold 29.90 32.37 8% 2.98* 3.60 1.25 2.3* 3.7*% 4.3% 10000.00 Dec.STERLING BANK Hold 2.14 1.57 -27% 0.34* 0.26 0.06 0.8* 6.5*% 5.2% 21592.00 Dec.SKYE BANK Under review 2.50 Under review Under review 0.30 Under review 20.7% 13219.00 Dec.U B A Buy 5.15 7.87 53% 1.29* 0.44 0.10 0.44* 11.3*% 4.0% 32981.00 Dec.

ZENITH BANK Buy 21.40 24.60 15% 3.17 2.16 1.75 1.20 8.20% 4.3% 31396.00 Dec.

Food & BeverageEV/EBITDA (x)

2014

Yield FY 2014

DANGOTE SUGAR REFINERY Under review 6.40 Under review 0.60 7.4% 12000.00 Dec.CADBURY NIG. Under review 39.90 Under review 0.65 4.7% 1878.00 Dec.FLOUR MILLS Hold 34.06 54.80 61% 1.93 3.50 1.60 7.10 3.60% 1.8% 2385.00 Mar.HONEYWELL FLOURMILLS Buy 3.79 5.20 44% 0.30 0.17 4.7% 7930.00 Mar.NESTLE FOODS NIG. Under review 900.00 Under review 38.00 17.50 34.5* 2.10% 4.6% 792.00 Dec.P Z INDUSTRIES Hold 28.00 34.60 24% 0.81 3.0% 3970.00 MayU A C N Buy 40.00 72.60 82% 1.75 4.7% 1920.00 Dec.UNILEVER NIGERIA PLC Sell 43.04 24.30 -44% 0.64 2.11 0.10 0.30% 5.0% 3783.00 Dec.

Building Materials EPS 2014eEV/EBITDA(x)

2014e

Yield FY

2014e

LAFARGE WAPCO PLC Under review 96.00 Under review 3.50 3.30% 3.3% 3001.00 Mar.

DANGOTE CEMENT Buy 178.00 198.40 9.07 9.87 6.00 13.00 3.60% 3.5% 17040.00 Dec.

Breweries EPS 2014EV/EBITDA(x)

2014

Yield FY 2014

GUINNESS NIG. Sell 160.56 111.00 -31% 6.30 2.70 7.00 9.30 5.40% 2.5% 1506.00 JuneINTERNATIONAL BREWERIES Hold 21.49 24.50 14% 0.30 1.5% 3263.00 Mar.NIGERIAN BREWERIES Sell 154.00 121.20 -21% 5.62 6.40 3.50 10.80 4.50% 3.5% 7562.00 June

Agriculture EPS 2013eEV/EBITDA(x)

2014e

Yield FY

2014e

OKOMU OIL Buy 28.52 41.50 46% 2.20 3.00 0.25 9.00 3.20% 6.7% 953.00 Dec.PRESCO PLC Buy 29.48 42.70 45% 1.29 1.60 0.10 9.20 0.40% 1.7% 1000.00 Dec.

PharmaceuticalsEV/EBITDA (x)

2013

Yield FY 2013

GLAXOSMITHKLINE BEECHAM NIG. Buy 54.00 78.60 46% 3.10 4.30 0.75 8.90 2.50% 3.8% 957.00 Dec.

Oil & GasEV/DACF(x)

2014Yield FY 2014

SEPLAT Buy 387.00 598.00 55% 0.58 0.87 3.10 4.70% 4.9% Dec.

Note – for full report on the recommended stocks kindly send an email to cslcsu@firstcitygroup.com

Top Highlight

Daily Retail Report

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Housing - Lagos builds 10,000 houses in eight years

Lagos State Government (LASG) stated last week that it has built more than 10,000 housing units in the past eight years. The units were targeted at residents of various income levels.

LASG estimates a deficit of 1 million housing units, with an estimated labour force of 8 million. Middle income earners often find it difficult to own houses, primarily because of insufficient wages and high mortgage rates. To bridge the housing supply gap, LASG launched the Lagos State Home Ownership Mortgage Scheme (HOMS) in March 2014. HOMS was designed to encourage and support home ownership for first time buyers through the provision of affordable housing units, as well as accessible and cheap mortgage finance.

So far, more than 600 first-time buyers have been allotted houses under HOMS at mortgage rates (fixed at 9.25%) lower than what commercial banks and mortgage companies typically charge (22.00-25.00%). The houses offered under the scheme are usually more affordable, sell for 30-35% less than similar houses constructed by private developers.

LASG is still a long way from bridging the existing housing gap, we believe. Attracting additional private sector participation by offering incentives to property developers (such as subsidising land costs and providing financial support) would be one way to significantly increase home ownership, in our view.

News Headlines

Stanbic IBTC to raise N24bn (US$120m) from rights issue: Stanbic IBTC Holdings says it is planning to raise N24bn from a rights issue once shareholders approve the transaction. The lender said on Wednesday that the development would help it to achieve its growth targets. Stanbic IBTC, majority owned by South Africa’s Standard Bank, said it would seek approval at a general meeting on June 3, Reuters reported. Source: punchng.com

Governors should be blamed for unpaid salaries – Okonjo-Iweala: The Federal Government on Wednesday absolved itself of blame for the inability of some state governments to pay their workers’ salaries. It said the governors of such states should be blamed for the development in their states because they were told through the Federation Accounts Allocation Committee to make the issue of wages a priority. The Minister of Finance, Dr. Ngozi Okonjo-Iweala, said this in a statement by her Special Adviser on Communications, Paul Nwabuikwu. Source: punchng.com

Military rescues 25 more women and children, destroys seven terror camps: The Nigerian military has rescued 25 more women and children from Sambisa Forest, and destroyed seven additional terrorist camps in the Boko Haram enclave, in a renewed onslaught against the Islamist sect. The Director of Defence Information (DDI), Maj-Gen. Chris Olukolade, disclosed this in a statement on Wednesday, adding that more Boko Haram fighters were killed in the process. Source: thisdaylive.com

Important Risk Warnings and Disclaimers

Daily Retail Report

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Retail views

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