Fakoyejo Olalekan
Airtel Africa outperformed MTN Nigeria in the Nigerian Stock Exchange last week, giving its investors more to celebrate than the ‘y’ello network’ gave its shareholders.
During trading last week, Prime Business Africa (PBA) learnt investors at Airtel and MTN made a whopping N941 billion between Monday, November 21, to Friday, November 25.
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However, Airtel Africa’s investors accounted for 71.8 per cent the largest share of the return on investment, with MTN Nigeria investors taking home the remaining 28.1 per cent.
A breakdown of the investment by PBA disclosed investment held by shareholders in Airtel Africa grew by N676.46 billion due to a rise in demand for the firm’s shares.
On the exchange floor of the telecommunications industry, PBA learnt investors showed more interest Airtel than they did in MTN Nigeria, resulting to the share of the former rising by 14.17 p er cent, while that of the latter only rose by 6.59 per cent during the same period.
Within five days, Airtel’s investors made N676.46 billion, as an increase in demand in the capital market pushed the company’s share up to N1450 at the end of Friday’s trading, rising significantly above the N1270 per share it started Monday’s trading with.
Due to the return on investment, Airtel Africa maintained its lead above MTN, as the most valuable or capitalised telco in the Nigerian stock market, ending last week with N4.77 trillion.
Prime Business Africa gathered that MTN Nigeria’s shareholders went home with a rather low gain of N264.60 billion, as their share could only grow by 6.59 per cent based on the level of demand for the y’ello share.
The demand had driven MTNs share from its opening price of N197 a stock, to N210 per share at the end of trading last week’. This lifted MTN’s market valuation up to N4.20 trillion from N4 trillion.
What you need to know
Surprisingly, Airtel outperforming MTN in the capital market comes at a period the company’s request to buy the 5G spectrum without bidding was turned down.
Airtel had lost the first round of bidding in December 2021, which prevented the firm from entering the 5G network market with MTN and Mafab Communications.
Airtel made an offer in the third week to buy the 5G spectrum for $273.6 million without bidding, but the Nigerian Communications Commission (NCC) said every company in need of the spectrum must bid to have it.
This means Airtel will have to spend more than $273.6 million if it will eventually acquire the 5G spectrum. This setback didn’t affect investors’ confidence going into the fourth week, which was last week.
Similarly, MTN also made an offer to acquire more 5G spectrum, but the telecommunications regulator has neither rejected nor accepted the network provider’s offer to compete in the next bidding round slated for this year.
