Shares of MTN Nigeria have surged by over 20% in early January, with more than 13 million shares traded, indicating strong market activity. This impressive rise is a correction following a dip in 2024, when the stock fell to N170 in November, primarily due to foreign exchange struggles.
In its earnings report for the nine-month period ending September 30, 2024, MTN Nigeria reported a significant 90.8% year-over-year increase in net foreign exchange losses, rising from N474 billion in 2023 to N904 billion.
To navigate these macroeconomic challenges, MTN diversified its financing options by issuing commercial papers, thereby boosting its short-term working capital. From early November to late December, the company rolled out Series 11 and 12, Series 13 and 14, and Series 15 and 16 commercial papers, each targeting N50 billion. All these issuances were oversubscribed, which likely played a role in the stock’s recovery.
As of January 10, 2025, MTN Nigeria’s share price reached N242, showing a more than 20% rise month-to-date. This followed a market correction, with the stock rebounding by over 40% in December and early January, surpassing N230 and approaching the N281 resistance zone reached in early 2024.
Market Trends
MTN Nigeria’s stock saw considerable fluctuations throughout the past year, reflecting changing market conditions. The year began positively, with the share price at N264 in January 2024 and a trading volume of 52 million shares, closing the month at N281. However, by February, the stock price began to decline, dropping to N222, continuing its gradual fall throughout the year. By November, it reached a low of N170, influenced by macroeconomic and foreign exchange pressures. However, the stock rebounded in December, climbing to N200 by month-end, coinciding with the company’s capital-raising efforts.
The company’s commercial paper issuances, including the oversubscription of Series 13, 14, and 15 papers, bolstered investor confidence and helped fuel the stock’s recovery, which saw it surpass N240 in early January 2025.
Commercial Paper Issuance
MTN Nigeria has been actively raising funds through its N250 billion Commercial Paper Issuance Programme. Recently, on December 23, 2024, the company issued Series 15 and 16 commercial papers, targeting N50 billion. This followed successful issuances earlier in the year, showcasing MTN Nigeria’s ability to generate substantial investor interest.
The Series 13 and 14 commercial papers issued on November 29, 2024, raised N72.18 billion, oversubscribed by 144%, thanks to strong investor demand. Earlier, in November, MTN issued Series 11 and 12 commercial papers, raising N75.1 billion.
The N250 billion Commercial Paper Issuance Programme, structured in tranches, provides MTN Nigeria with the flexibility to meet its financial and strategic goals, ensuring it continues to attract investor interest and support its business objectives.
By strategically managing its financing and operational needs, MTN Nigeria aims to continue its recovery, benefiting from investor confidence and solid market performance.