May 8, 2025/Cordros Report

Just as in previous periods, Access Holdings Plc delivered the largest gross earnings in Q1-25 (+39.0% y/y) underpinned by the group’s robust asset portfolio (NGN39.09 trillion). The group recorded a 36.3% y/y growth in interest income to NGN980.68 billion driven by the elevated interest rate environment. However, the high-rate environment also led to higher funding costs (+71.3% y/y) for the group, causing net interest income to decline (-20.1% y/y). We revised our 2025E EPS estimate downward to NGN14.42 (previously: NGN15.59) and reduce our target price by 8.4% to NGN35.28/s, maintaining our “BUY” rating.

The downward revision owes to the surging funding costs which are expected to weigh on profitability in 2025E. Also, we estimate a gross DPS of NGN3.00 in 2025E, which translates to a dividend yield of 13.9% based on the last closing price of NGN21.55 (7 May). Our model suggests the stock is trading at a 2025E P/E and P/B estimates of 2.5x and 0.4x, respectively.