Nigeria eCommerce eye $1.5Bn, $3.2Bn from IPOs

Two major players in the eCommerce market in Nigeria are creating visible excitement in the space with eye-catching listing of their shares on the international market.

Jumia is planning an initial public offering (IPO) in New York this year which will reportedly see the business valued at $1.5 billion.

Elsewhere, Konga, Nigeria’s biggest Omni- channel eCommerce group, is also reportedly set for a major listing on either the London Stock Exchange or New York Stock Exchange (NYSE) by the last quarter of 2020.

National Daily gathered that the Konga Group is set for an initial public offering that will see the eCommerce giant valued at about $3.2b, further shoring up the potential of the eCommerce industry in Nigeria, Africa’s biggest market.

Investigations reveal that Mark Jessey, a prominent stock analyst on NYSE had hinted of the strong possibility of a Konga IPO before the end of next year.

A move which, according to him, is a much sought-after one by investors, many of whom have followed within the last 8 months the huge strides and trajectory of the business which came under new ownership after the exit of previous majority investors, Naspers and AB Kinnevik.

While Jumia’s successful listing could help MTN reduce its debt which unconfirmed reports indicate to have increased to over five billion dollars in June from about $4.1b at the end of 2017, Konga’s imminent IPO is one that should see the business excite a horde of potential investors, going by the current standing of the company.

Commenting on the likely listing of Konga, Chris Uwaje, Africa chair for IEEE World Internet of Things (WIoT), noted that the company has added huge value to the e-commerce landscape which should see its value gross over $3.5b.

“Within the last seven months, I am aware that the new owners of Konga have repositioned the company strategically and upped the overall value of the business. Konga could claim to be unarguably the most structured e-Commerce company in Africa, with huge infrastructure and technology back-bone which is rare in Africa and which is the strength of global players such as Amazon and Alibaba.

In valuing Konga, you must consider its strategic 360 degrees Omni-channel strategy, their Central Bank of Nigeria-licensed mini bank – KongaPay which I am sure cannot be valued anything less than $750m and best in Africa digital logistics division known as Kxpress with a nationwide network. I know Konga is likely the only company that does about ninety percent of her long haul and last mile deliveries in the continent.

“In today’s investment climate, investors are investing strategically in quality companies that are owned by experienced and well tested local Entrepreneurs with global vision and I am sure you know Konga has all these qualities under one roof in addition to over thirty physical retail stores spread all over Nigeria and which also act as delivery, collection and payment centers, so they could ask for more than $5b for their sweat.”

Commenting further, Mr. Uwaje stated: “We have also seen the huge investment in massive warehouses across major cities such as Abuja, Enugu, Akwa-Ibom, Rivers State, Imo, Kano, Delta, just to mention a few, in addition to more than three mega structures in Lagos.  I am also aware that the company recently spent over N9b in acquiring a very huge warehouse in a high-brow area in Lagos in preparation for Artificial Intelligence and Robotics-driven warehousing.”

According to Uwaje, who doubles as director general, Delta Innovation Hub, Konga is an African eCommerce Unicorn whose impressive strategies and achievements within such a short period would be hard to replicate in the Nigerian e-Commerce space.

Chief executive officers of the Konga Group could not be reached for comments but a highly placed staff of the company disclosed that all management staff were in a lengthy strategy meeting and would hate to interrupt them.