By Ify Onye InvestAdvocate

Lagos (INVESTADVOCATE)-Pressure is mounting by the day for Mobile Telecoms Giant, MTN Nigeria to list on the Nigerian Stock Exchange (NSE) by 2012.

This is coming on the heels of a Statement Monday from the Capital Markets Committee of the Nigerian House of Representative and made available to www.investadvocateng.com in Lagos Nigeria.

The Statement titled “Listing of Economic Interest Sector Companies on the Nigerian Bourse” affirms that there is every need to get Telecoms operators in Nigeria Listed on the Bourse of the Nigerian Stock Exchange.

“This sector, with a starting Market of less than a Million in 2000, now caters for over 90 million users.  These telecommunications companies make huge profits from Nigeria and are mostly not listed on our Market” the statement said.

According to the House Committee on Capital Markets, MTN Nigeria that got its licence in year 2001 for the sum of USD285 million ($825,000,000) mostly financed by Nigerian Banks; between January and June the same year repatriated some $5.0 billion as profits from their operations in Nigeria.

“It is not in doubt that the MTN Nigeria which is listed on the Johannesburg Stock Exchange under the Industrial- non clinical services- Telecommunications sector is the largest contributor to the Bourse with MTN Group as the largest player in the sector. The Nigerian Group accounts for 25 percent (25%) of the headline revenue of the MTN Group listed on the Bourse. The story is not much different with the other Telecoms Operators in the country” the Statement said.

The Committee further affirmed that preliminary extrapolated figures indicate that the telecoms (MTN, Airtel, Glo and Etisalat) in terms of Market Capitalisation could account for an average of N 6.76 trillion. (MTN-2.4 trillion, Airtel-N1.55 trillion, Glo-N 1.70 trillion and Etisalat-N1.1 trillion) by the Second Quarter (Q2) of year 2012, “a figure far higher than the current Market Capitalisation of N6.38 trillion as at November 22, 2011” the Statement said.

Apart from the Telecoms, pressure is also mounting on other economic interest sectors for its players to list; these includes; the Energy Sector and its players, Power Generation and Distribution Companies.

According to the Committee, if the Energy Sector and its players are listed on the Nigeria’s Exchange, the Committee will partner with relevant stakeholders to speed up passage of the Petroleum Industries Bill (PIB) to foster subsequent listing of major upstream players, the Nigerian National Petroleum Corporation (NNPC) and all other operators in the oil and Gas sector.

“This will imply ownership of these Companies by Nigerians and subsequently diminish the secrecy and massive fraud that is associated with the Oil and Gas sector in Nigeria” the Statement affirmed.

The Committee also said they would legislate in order to get Power Generation and Distribution Companies listed once the process of their privatisation is completed.

“What needs to be done in Nigeria is very clear to us and the general consensus is that the reforms we have planned, will address the development gaps as observed. We will engage widely with all stakeholders to get the best inputs into this proposed legislation.

The House Committee also expressed it was pleased with the positive comments, support and encouragement so far expressed by Captains of Industry, Lamido Sanusi, Governor of Nigeria’s Central Bank, Media Houses and Market Operators who have provided them with sound ideas that encourage them to place a Bill on the floor of the House for consideration and passage by 2012.

“This is a generational responsibility that must be met and this intervention by the House would once more signpost its resolve to rise up to the developmental challenges we are confined with” the Statement said.
 
According to the Committee, the Market in Nigeria is in a state none of us can be proud of. The All-share index (ASI) that rose to 57,990.22 points by December 31 2007 with Market Capitalisation of N13.29 trillion with over 300 Listed Securities on the Exchange has by 2011 witnessed a 56% decline to 20,202.50 points and a Market Capitalisation value of N6.44 trillion.
 
They affirmed that amongst the causes of the downward trend and eventual collapse of the Market was the fact that our Nation’s Stock Exchange was and still is relatively small and unrepresentative of the size of the nation’s economy, underdeveloped, illiquid and operated in isolation from other Markets. “This is unsustainable and must change to engender development of the Nigerian economy” the Statement said.

“It is in the light of all these that this committee has set out to partner all stakeholders and Market Operators to engender growth and diversification of the Market so that it can be more reflective of our nation’s economy.
 
This House needs to lead the fray, and we will, in ensuring that growth is engendered via the Capital Market. Thus it is incumbent on us to pass legislative reforms that would encourage designated sectors to list on the bourse of the Nigerian Stock exchange. This will be through formal and contractual requirements to do so, supported by incentives, unbundling of stringent eligibility requirements that create high barriers for potential entrants and hinder participation by willing businesses, and adoption of options that promote foreign investment in our economy under terms that support our national interests” the Statement said.