The plan by Dangote Cement Plc to undertake a share buy-back programme this week fuelled the bullish run in the stock market as investors took position in the company, leading to N1.043 trillion gains at the end of the trading week shortened by the Yuletide holiday.
Dangote Cement had revealed that it would be undertaking the tranche-1 of its share buy-back programme on December 30-31, 2020, after obtaining shareholders’ nod to go ahead with the programme early this year.
The company hopes to buy back up to 85.2 million fully paid up ordinary shares of 50 Kobo each, representing 0.5 percent of the entire current issued shares of the company.
It explained that the execution of the tranche-I of the programme would not have any material impact on it’s financial position.
Consequently, the stock market received a boost as the All Share Index (ASI) rose by 5.4 percent week-on-week ( w/w), the second consecutive weekly gains, and closed at 38,800.01 points.
Bargain hunting in Dangote Cement Plc, which rose by 17 percent, Airtel Africa Plc (10%), BUA Cement Plc (+9.1%), and Flourmills of Nigeria Plc (+7.5%) buoyed market performance.
Similarly, the equities market capitalisation rose by 5.4 percent to N20.279 trillion.
Activity level was strong, as volume grew significantly by 35.6 percent w/w to 2.756 billion units, while value spiked by 128.4 percent to N40.311 billion during the week.
Analysis of the sectoral activity showed that performance across sectors was broadly positive with the exception of the banking sector that fell by one percent.
Conversely, the industrial goods sector, insurance, oil and gas and the consumers goods sectors advanced by 12.1 percent, six percent, 1.4 percent and 0.3 percent respectively.