How much are Dangote’s three listed companies worth?

The group has 15 subsidiaries, and three of them are listed on the Nigerian Exchange. It is not clear if Dangote Refinery will be listed when fully operational, but unconfirmed sources suggest that there is a plan awaiting execution to list it on the London Stock Exchange.

MarketForces Africa gathered from Broadstreet that the primary purpose of the cement company’s share buyback is to obtain the right price for listing outside the local stock market and establish a global brand identity.

The current year has proven naysayers wrong that the Nigerian Exchange has failed to reward performance. A number of stocks have taken off, propelled by either market sentiment or strong earnings records.

Surprisingly, Dangote brands have both. The cement company’s sales reach above N1 trillion annually, and the sugar refinery is positioning itself to dominate the market. Imagine a stock gaining more than 200% in six months.

That is a profound statement for investors who are looking to generate alpha in an economy that is confronted with numerous challenges, both domestic and international. These challenges include overwhelming debt burdens and increasing concerns about the accuracy of national economic data.

Ahead of the planned merger of Dangote Sugar Refinery with NASCON and Dangote Rice Limited, the market valuation of Dangote brands has significantly increased, accounting for approximately 20% of the Nigerian Exchange market capitalisation.

The recent share buyback undertaken by the cement company has pushed its equity market valuation above N6. 2 trillion. If valuation is based on size, Dangote Cement is larger than both BUA Cement (N3.3 trillion) and Lafarge Cement (N491.2 billion).

In 2023, Dangote Sugar Refinery has emerged as one of the top performers on the local exchange. The worth of the sugar refinery inched up to N779.2 billion on Friday, while the market valued NASCON at approximately N154 billion.

In their 2023 estimate, equity analysts at CardinalStone Securities maintained their position on volume sales projections, hoping that an improvement in Pan-African markets would offset the impact of output decline in Nigeria.

The investment firm said it has slightly adjusted the cement price estimate to N71,377/tonne from N66,930/tonne previously. This adjustment is due to the expected positive foreign exchange translation from Pan-African operations.

Though operating and finance costs will likely remain elevated in the short term, analysts foresee a lower tax charge due to deferred tax credits and pioneer incentives, which should provide some margin support.

On average, the cement company is forecast to post earnings per share of ₦20.60 for next year compared to ₦22.27 last year.

Dangote Cement reported a double-digit increase in revenue by 17.7% year on year to N950.8 billion in the first half (H1) of 2023 from N808 billion in H1 2022, its unaudited financial statement showed. Dangote cement volume production surged by 9% in the second quarter of 2023 from what was reported before.

Dangote Sugar Refinery

In the first half of 2023, Dangote Sugar Refinery Plc. announced N18.22 billion as dividends to shareholders for the year ended December 31, 2022. The dividend pay out translated to N1.50 kobo per share held by shareholders.

The company recorded an impressive turnover of N403 billion, a 46 per cent increase over N276 billion recorded during the same period in the year before, and posted a Profit before Tax (PBT) of N82 billion.

For 2023, the company said it is targeting the production of over 170,000 tonnes of sugar next season.

NASCON

Shareholders to get N2.65 billion as NASCON Allied Industries Plc. recorded impressive growth in all performance indicators in the year ended December 31, 2022.

Profit after tax surged by 84 percent, from N2.97 billion to N5.47 billion. Shareholders at the company’s 2022 annual general meeting (AGM) held at the weekend in Lagos commended the board and management of NASCON for consistent payment of dividends.

Analysis of the food seasoning company’s annual report indicated that profit before tax rose significantly by 98 percent, from N4.24 billion to N8.37 billion, representing an increase of N4.12 billion.

Turnover was on the upswing, increasing from N33.28 billion to N58.79 billion, a 77 percent increase compared to 2021. Earnings per share also increased to 206 kobo in 2022 in contrast to 112 kobo in 2021.