By Chioma Obinagwam
The Nigerian Stock Exchange (NSE) may witness little or no delisting exercise in the current year of 2017, financial analysts have said.
This is despite the haemorrhaging macro-economic indicators, depleting Foreign Exchange (FOREX) reserves, as well as unstable exchange rate regime, which no doubt, has had its toll on companies listed on the Exchange.
Recall that in 2016, 14 companies were delisted from the NSE, mostly for market infractions.
Although the Nigerian economy is currently witnessing galloping inflation, with a digit inflation rate as high as 18.72 per cent, analysts believe that fewer companies would undergo delisting exercise because the most of delisting that occurred in the prior year was due to market infractions such as non-submission of their results as well as violation of other post-listing rules.
Reacting to the issue, the Chief Executive Officer(CEO) of Enterprise Stockbrokers, Rotimi Fakayejo said: “Well, I think we may not really expect much delisting this year. This is because most of the companies have been on the delisting lists in the past two to three years. If we will have any of that, it won’t be more than a single digit, it cannot be more than three companies.”
Another Stockbroker who pleaded anonymity, affirmed that the companies were delisted for flouting post-listing rules.
“Those companies you saw delisted last year were as a result of infraction. Most of them were not releasing their results as at when due. Some prefer to pay the fine not really because of the macro-economic impact,” she asserted.
Nevertheless, since the beginning of the current year, NSE has witnessed three listings- one Exchange Traded Fund(ETF) and two equities listing on the main board of the NSE.