INVESTORS LOSE N1.3B IN NSE'S ALTERNATIVE SECURITIES MARKET

Investment on the Nigerian Stock Exchange (NSE) Alternative Securities Market (ASeM) declined by N1.33 billion at the end of trading on June 14, 2018.ASeM is a specialised board of the Nigerian Stock Exchange (NSE) for emerging enterprises with high growth potential. ASeM index fell to 949.59 points at the end of trading on June 14, 2018, from 1,087.32 points at the beginning of the year, representing 12.67 per cent decline. Capital market operators attributed the poor performance of the companies listed on the sector to lack of information flow and poor corporate governance structure.

The NSE-ASeM capitalization, which opened for the year at N10.432 billion declined by N1.33 billion to close at N9.099 billion as at June 14, 2018. The NSE had on April 6, 2018 delisted the shares of Afrik Pharmaceuticals Plc worth N12.45 million from the market segment. Also, on January 29, 2018, the NSE began the implementation of new pricing rules, which removed the stopgap that has supported stocks at their nominal value to allow shares of quoted companies to trade for as low as one kobo. Unfortunately, companies on the sector were affected by the rule, while some of the stocks experience inactive performance, as prices remain unchanged.

Chellaram, Juli, Smart Products Nigeria, Amino International and Rak Unity Petroleum Company shares price remain at N3.08, N1.67, 54 kobo, 25 kobo and 50 kobo per share, respectively. Mcnichols shares went down by 18.33 from N1.20 at which it opened for the year to 98 kobo as at June 14, 2018. Omoluabi Mortgage Bank recorded a year-to-date decline of 5.33 per cent to close at 71 kobo. The Initiates depreciated by 7.32 per cent, while Capital posted a year-to-date decline of 34 per cent. ASeM provides smaller companies the avenue to access the capital market and raise long-term finance through less stringent listing rules and requirements in line with regulatory requirements of the Corporate Affairs Commission (CAC) and the Securities and Exchange Commission (SEC).

With the numbers of small and medium scale enterprises (SMEs) in the country, yet the NSE has been able to attract and list only eight SMEs companies on the NSE ASeM sub-sector. Despite regulatory efforts at reviving the alternative securities market (ASeM) of NSE, companies listed on this segment of the market are yet to attract the needed liquidity from local and foreign investors.

(Guardian)