Operators bemoan eight years of inactivity, apathy in primary market segment | The Guardian Nigeria News - Nigeria and World News

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The inactive state of the primary market segment of the Nigerian capital market in the last eight years has become a source of worry to operators, leading to apathy as most companies now resort to alternative means of raising capital, especially through bonds and Commercial Papers (CPs).

Personal Assistant to Chief Executive Officer, X3m Ideas Limited, Victoria Buzugbe ; Creative Director, X3m Ideas Limited, Sola Kosoko; Executive Director, Market Operations and Technology, Nigerian Stock Exchange , Ade Bajomo; Chief Executive Officer, X3m Ideas Limited, Steve Babaeko; Head of Finance, X3m Ideas Limited, Folahan Salam, Head, Information Security, NSE, Favour Femi-Oyewole; Head of Human Resources/Administration, X3m Ideas Limited, Olasukanmi Atolagbe, and Team Lead Copy, X3m...

According to them, the poor state of the capital market has made it impossible for companies to float shares successfully on the floor of the Exchange, even as they leverage the debt market as an alternative window to raise capital for operations. The primary market is also where securities are created. In the primary market, companies sell new stocks and bonds to the public for the first time, such as is the case with IPOs.

“Other than MTN’s offer for subscription targeted at retail investors, the primary market for equities was virtually inactive in the past eight years. According to him, the preference for the money market and debt instrument arises from the fact that returns on such facilities, which are loaned to government or corporate bodies, are guaranteed with high yields for the fixed period of their tenure, unlike stocks which are exposed to the vagaries of market forces as they are traded daily.

 

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