Research experts from Meristem Securities Limited have predicted the growth rate of the equities section of the Nigerian Stock Exchange for the year 2013 to be 11.05 per cent.

According to the analysts, the NSE’s All-Share Index is expected to close at the level of 29,977.10 basis points at the end of this year.

The analysts, who made this projection during the presentation of Meristem Outlook 2013 in Lagos on Tuesday, said that the Exchange might not witness the kind of growth that was recorded in the market in the year 2012.

This is coming just as the Index hit a four-year high of 30,093.83 points on Wednesday. The NSE All-Share Index rose by 1.4 per cent or 406.88 points, from the 29,686.95 points recorded the preceding day to 30,093.83 points.

The market capitalisation of the listed equities rose by 1.4 per cent or N131bn to close at N9.625tn, up from N9.494tn the day before.

Speaking at the occasion, the company’s Director, Investment Research, Mr. Gary Watson, said that even though the equities market recorded improved activities at the end of 2012, such a performance might not be feasible in 2013.

He said, “Our bullish portfolio for 2012 returned 42 per cent, however, the NSE Index returned 35.45 per cent for the same year. We believe that fundamentally, the market should go up by about 11.05 per cent and may be slightly higher, added to the 35 per cent that was recorded last year.

“However, what investors should note is that even though the index may record 11.05 per cent, it doesn’t mean that stocks would turn in that same amount, some stocks may turn in as high as 50 to 70 per cent returns to investors. So, we still advise investors to invest in the right stocks.

Watson noted that there would be increased activity in the market in terms of investments, as even more foreign investors were showing interest in investing in the Nigerian market owing to its performance in the last few years.

On his part, the Group Managing Director, Meristem Securities, Mr. Oluwole Abegunde, noted that the equities market promised huge returns for investors in the year 2013.

He explained that the financial sector of the NSE remained a sector to watch out for during the year, as it might likely continue to drive volumes in the market.

He said, “Our 2013 expectation for the equities market is expected to be driven by the financial services sector, majorly the banks. And so, for us, that sector is still one to look out for, post consolidation, as the banks now have better risk management systems and their asset quality has also gone up. This would manifest in their full year results.”

Source: Punch (written by Udeme Ekwere)