Mad Returns: NAHCO leads NGX’s top gainers as it adds 23% in one week

NAHCO added N2.39 billion in market capitalization last week, becoming the top gainer of the five-day trading week as investors react bullishly to an improved financial performance, announcement of dividend payment and bonus issue of shares.

In the last four weeks, we have seen NAHCO gain 13.40% to currently stand at N7.94 per share. Its market capitalization currently stands at N12.90 billion, also gaining approximately 23% during the week under consideration.

NAHCO was the top performer in a very bearish week for the NGX where we saw its All-Share Index lose 2.18% to currently stand at 52,908.24 basis points, down from the 54,085.30 basis point it closed the preceding week which represented the highest point for the year.

During the trading week, 36 equities appreciated in price during the week, higher than 23 equities in the previous week. 45 equities depreciated in price, lower than 54 equities in the previous week, while 75 equities remained unchanged lower than 79 equities recorded in the previous week.

What you should know

  • NAHCO, which stands for Nigerian Aviation Handling Company Plc, is involved in the provision of services, including aircraft handling, cargo handling, passenger profiling, crew transportation, leasing of ground handling equipment and equipment rental.
  • The Company’s aircraft handling services include ramp services, passenger profiling, security and baggage handling (loading and offloading). Its cargo handling services include cargo documentation services for airlines, import and export cargo facilitation through warehouses in Lagos, Kano, Abuja, Port-Harcourt and Enugu. The firm has a learning and development center that provides training support for the nation’s aviation industry. The Company serves over 35 airlines across Nigeria.
  • The reason we are seeing such a strong appreciation in price and a strong addition in its market capitalization is as a result of the firm’s first-quarter performance compared to the previous first quarter.
  • NAHCO recorded a 27.82% increase its revenue to N2.82 billion compared to the N2.20 billion recorded in Q1 2021. This was majorly attributable to increases in passenger/aircraft handling and import cargo handling.
  • Although it recorded a decrease in other income to N25.61 million, the firm still managed to grow its profit from operations to N431 million, a 100.63% increase compared to the N215.18 million recorded in Q1 2021.
  • Despite increased finance costs and tax obligations, the firm recorded a profit after tax (PAT) of N324.10 million, a 91.08% increase compared to the N169.61 million recorded in Q1 2021.
  • Also weighing in on the gains seen, NAHCO’s board agreed to the payment of dividends and bonus issues for its shareholders.
  • The firm has agreed to a final dividend of 41 kobo per ordinary share, which is subject to appropriate withholding tax and approval.
  • The firm also agreed to issue a bonus issue of one new share for every five existing shares held by shareholders.
  • Therefore, shareholders whose names appear in the Register of Members at the close of business on Friday 15th July 2022 will be entitled to both the dividend payment and the bonus issue that will be paid on Friday, the 29th of July 2022.
  • During the trading week, we saw a spike in the volume of NAHCO shares, with more shares changing hands than average. The highest volume during the trading week was posted on Thursday, as it recorded a volume of 7,905,679.
  • On Friday, its share price traded close to its 52-week high of N8.25 as it gained 1.53% on the trading day in question.
  • NAHCO began the year with a share price of N3.74 and has since gained approximately 112% on that price valuation, ranking the 7th on the NGX in terms of year-to-date performance.

NAHCO is the 28th most traded stock on the Nigerian Stock Exchange over the past three months. It has traded a total volume of 178 million shares, in 5,439 deals, valued at N1.06 billion over the period, with an average of 2.83 million traded shares per session.

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