Analysts Optimistic on Transcorp Power Listing on the Nigerian Stock Exchange

Financial analysis stock brokers have yet again come up with another positive projection about the listing by introduction made by Transcorp Power PLC in Nigerian Exchange Limited some days back. According to the projection, investors should consider investing in the stock, as it is expected to bring high heels to only those who foresee the future.

Journalists also believe that the listing presents opportunities to the nation's capital market while providing a good sport for the nation's power sector.

A large number of those who spoke on the listing stated that it would open the eyes of the power sector players to the low-cost funding opportunities provided by the capital market.

To shed more light on the listing, Abdulmumin Ali, Managing Partner, QL Resources Limited, stated that the capital market will offer impressive rewards to potential investors and also assist in enriching the Nigerian capital market.

He added that Transcorp Power (TRANSPOWER) shares have gained more than 47% since it launched a week ago. Mr Ali is optimistic about the stock's sustained good performance in the market. He said only investors who take good positioning will gain from the uproar in the short to medium term.

"Anyone with investible funds should buy Transcorp Power shares now. Such investments will likely triple within the next year," Ali predicted.

 Ali pointed to the 84% spike in profits between 2022 and 2023 and the exponential increase in share capital over the same period as indicators of great opportunities for investors.

"Transcorp Power's Revenue From Contracts with Customers grew by 57 percent over the past year to culminate in a Profit Before Tax of N52.7 billion as of December 31, 2023. This was, in effect, a profit spike of 84 percent from N27.6 billion as of December 2022. Again, you will note when you review the Independent analysts' reports that their topline has grown consistently over the past five years, with good efficiency ratios."

Speaking about this, Mr Mike Eze, the CEO of Crane Securities, stated that the listing of Transcorp Power on the Nigerian Stock Exchange (NGX) will benefit both the newly listed company and Nigerian investors. He added that the Nigerian securities market remains the destination of choice for businesses in need of low-cost capital while also providing the right opportunities for diversification that improve governance.

Eze added that the Nigerian securities market has the sophistication and stature to absorb any funding demands of power sector companies such as Transcorp and urged other players to embrace the capital market.

"Ours is an emerging market, which was rated the best-performing market in the world in 2023 by the International Finance Corporation (IFC). We received favourable ratings from other international agencies as well. The capital market can raise funds to any required capacity. It all depends on the needs of the issuer! The Nigerian Exchange Plc market has the capacity and appetite to meet the demands of the power sector and other sectors should they all decide to come together," he said.

Also, Vincent Ugwu, Managing Director/CEO of De-Lords Securities Limited, believes the capital market may eventually become the destination of most of the players in the power sector in Nigeria because of its advantages in raising low-cost capital.

"There is no doubt that investors' interest in Transcorp Power's stocks will attract other players. Opportunities abound in Nigeria's power sector. There are opportunities in the gas value chain, opportunities to widen coverage areas, and opportunities to sell power cross-border. Discerning players such as Transcorp Power will always come to the capital market and get the sort of growth they dream of," Ugwu stated.

The current share pice of Transcorp Power Plc is ₦ 377.8.