The National Bureau of Sta-

tistics (NBS) has released the

frst data set of growth rates
since the country rebased its
gross domestic product (GDP)
in April. It reviews downward
the 2013 national growth rate
by 1.9 per cent from 7.4 per
cent to 5.5 per cent. A careful
study of the data confrms the
maxim that the higher up the
national GDP goes, the cooler
the growth rate becomes. Bis-
marck Rewane, chief execu-
tive of Financial Derivatives, a
consulting frm, observed said
that it is much easier to grow
when you are small than when
you are big.
But the downward revision
of the countrys growth is not
the real story. That lies in the
interesting trends revealed by
the data.
Demographics is
King
Yvonne Mhango, sub-Sa-
haran Africa economist at Re-
naissance Capital, in a report
Nigerias GDP: Bigger but
Slower points out that the data
shows the nuggets in the Ni-
gerian economy are not to be
found in the oil and telecoms
sectors as generally presumed.
Instead, they are in manufac-
turing, specifcally food, ce-
ment, and textile, as well as
real estate.
These are poised to beneft
from the countrys booming
population, and growing mid-
dle class. Despite the chal-
lenges faced in the power sec-
tor, manufacturing recorded
solid growth of 22 per cent or a
good one-third of total revised
growth. This indicates the huge
demand and market size for
producers in these benefciary
sectors. For example, the food,
beverages, and tobacco subsec-
tor grew to 12 per cent or al-
most half of total manufactur-
ing quota - in 2013 from 7 per
cent in the preceding year.
Real estate is another dy-
namic sector. This should
come as no surprise. Although
it is generally agreed that valu-
ations are excessive there is no
debate that the rate of develop-
ment in its cities is phenom-
enal. Cement, which makes
up 1 per cent of GDP, grew by
25 percent from 14 per cent in
2012 to 39 per cent in 2013.
This is in line with growth
rates of 14.2 per cent in the
construction sector against
9.4 percent in 2012, and 12 per
cent in the real estate sector
versus 5.6 percent in the pre-
vious year. The take-of of the
Nigerian Mortgage Refnance
Corporation (NMRC) and the
passing of the Pension Law
Reform will give added fllip
to home ownership in coming
years further boosting the sec-
tor and its contribution to GDP
growth.
Not so fast
Mhango is clear that tele-
coms growth is in the past and
the sector has matured.
The issue the GSM compa-
nies are facing is a structural
one, not one of tightening in
disposable income as many
commentators have noted
about the brewery sector. Ni-
gerians is a phone-saturated
country. Beyond the din and
ambiance of indistinguish-
able promos, most subscribers
simply ignore the confusing
menu of packages cast before
them. In 2013, MTN, the mar-
ket leader, added 9.3 million
new subscribers but managed
to grow revenues only by 5.7
per cent in the face of what the
company describes as aggres-
sive competition and a difcult
operating environment.
This may have an unin-
tended consequence. If growth
is indeed slowing in the sector
it means that there are fewer
places to invest the huge rev-
enues being generated by
these companies. Therefore,
the demand by Arunma Oteh,
director-general of the Securi-
ties and Exchange Commis-
sion, and Oscar Onyeama, her
counterpart at the Nigerian
Stock Exchange, that these
companies be compelled to list
makes a lot more sense. Slow-
ing growth is evidence that
companies in the sector are
transitioning into the cash-cow
phase, aka dividend distribu-
tion era. This will be a good
thing.
Any cause for alarm?
According to DaMina Ad-
visors, a London-based risk
research, and consulting frm,
the decline is not good news
coming on the heels of growing
concern over the spread of the
Boko Haram terrorist threat
to the commercial capital of
Lagos.
DaMina analysts do not be-
lieve that a 4.5 per cent growth
rate is unthinkable. If the for-
eign share of transactions on
the NSE drop below the cur-
rent 45 per cent suggesting
capital fight, it will remove the
cushion undergirding the high
speculative forward price earn-
ings multiples of many listed
Nigerian companies. This
could happen if a combination
of prolonged anaemic econom-
ic growth stagnation, falling oil
exports, a fast depleted forex
reserve stock and declining eq-
uity market valuations, which
may be more proximate than
is currently apparent. For the
countrys policy-makers, the
gallows consolation is that
foreign investors looking for
sub-Saharan exposure have
few alternative choices. With
a 2013 growth rate of 1.9 per
cent, South Africa holds little
attraction, and the prosperity
of a growing number of region-
al economies are tightly corre-
lated with Nigerias.
Vanguard Markets | Monday, July 21, 2014 | Issue 002
INTERVIEW
A cerebral approach
to transactions
at Olaniwun Ajayi LP
! Deal Engineer - page 3
C-SUITE
Fixed Income & Forex
Inside
Your listing or your life
A proposed bill to
compel companies
with either more than
N40 billion in share-
holders funds or over
N80 billion in assets to
list on the NSE raises
serious questions.
! Page 2
Back on the throne
Jim Ovia, founder
of Zenith Bank, has
resumed as chairman
of Zenith Bank. This
comes as no surprise
to many who knew it
was only a matter of
time before he re-
turned to what many
call the Goldman
Sachs of Nigeria.
! Page 2
Crossed ngers for
Q2 earnings
Companies are set
to begin releasing
second quarter results.
What lies in store?
! Page 6
Manufacturing roars
ahead
0B 10.0 10.0
04/07 07/07 07/07 14/07 15/07 15/07 17/07 18/07 18/07 09/07 10/07 10/07
100B 12.0 15.0
14.0
75B 11.5
13.0
50B 11.0
12.0
25B 10.5
11.0
FGNBonds &TBills NITTY NIBOR
FGN Bonds
Treasury Bills
O/N
1M
3M
6M
Wolemi Esan
161.5
07/07 15/07 18/07 10/07
163.0
162.7
162.4
162.1
161.8
FX ($/N)
Source: FMDQ
Bid
Ask
1M
2M
3M
6M
9M
12M
African wax fabrics mill Source: shaddersafrica.com
3%
12 13 14f 15f 16f
7%
6%
5%
4%
Annual GDP Growth
Sub-Saharan Africa
Nigeria
4%
11 12 13
8%
7%
6%
5%
Real GDP Growth
Source: World Bank Source: National Bureau of Statistic,
Central Bank of Nigeria
Old GDP Series
New GDP Series
INSIGHT 2
JAYWALKER
RESHUFFLE
VM| Monday, July 21, 2014 | Issue 002
Listing by Order
Early this month, a bill in-
troduced by Hon. Chris Az-
ubogu, APGA - Nnewi North
/ South and Ekwusigo, to
compel companies with assets
worth more than N80 billion
or shareholders funds that
exceed N40 billion to list on
the Nigerian Stock Exchange
passed 2nd reading. In the
past, similar calls for such ob-
ligatory initial public oferings
have come from voices as di-
verse as labour unions, retail
shareholder associations, and
market regulators.
In the view of Hon. Ek-
wusigo the bill would assist
the companies to raise cheap
funds in contrast to bank
loans and the concomitant
high interest rates. Supported
by Leo Ogor, PDP Isoko
North/ Isoko South, the Dep-
uty House Leader, he argued
that if passed the bill would
enable more Nigerians to par-
ticipate in the upside of the
national economy.
Hon. Fort Dike, PDP Ihia-
la, disagrees with this position.
Known for speaking his mind,
he stated that the proposed
law is anti-business because
it will be in confict with the
general ideas of investment in
the country and make the par-
liament look like it lacks busi-
ness knowledge.
The decision to list should
be at the sole discretion of
boards, who owe allegiance
to the best interests of their
shareholders, employees, and
customers. Perhaps, the de-
bate should be inverted. In-
stead of companies that fall
within these arbitrary catego-
ries being forced to list and pe-
nalized for not doing so, they
should be given incentives for
doing so.
Taking the arguments pre-
sented by sponsors of the bill,
each one can be disputed with
sufcient points.
There are material nuances
to consider in the determina-
tion of whether a company
should raise capital through
debt or equity. In the same
vein, the arithmetic on which
is cheaper is not so simple. Let
us not forget that for many
companies of this size, they
can raise ofshore loans that
are signifcantly cheaper than
the exorbitantly priced funds
available locally. Companies
could also put up a credible
argument that so long as they
pay their taxes to government
it is not their duty to provide
gangways to vessels of eco-
nomic participation. Moreo-
ver, a lot of the talk on broad-
ening economic participation
often gives the impression
that it is mainly about giving
retail shareholders access to
wider stock portfolio choices.
This is a paradox in an age
when deretailization is a secu-
lar trend. Finally, while it is
not proclaimed there is a risk
that foreign companies might
see themselves as the main
target of the law. If this is true
it sends the wrong signal at a
sensitive time.
Companies do rationale
things. If it makes solid busi-
ness sense for them to ap-
proach the market, they will
not hesitate to do so. Besides,
if the so-called cheapness
of equity is not undisputed,
what are the other gains for
companies that are not in dire
need of capital when they list
their shares? This is where the
proponents need to do more
homework in building their
case.
Then what if the market sen-
timent is not right at the time
a qualifying company crosses
the threshold? Assuming that
investors are cool toward the
sector for any number of rea-
sons, should executives and
their investment bankers not
retain the prerogative to de-
cide the most opportune time
to sell shares at at a good valu-
ation?
This is not to say that the
idea wholly lacks merit. There
are a good number of local and
foreign companies in Nigeria
whose presence on the bourse
would enhance risk diversif-
cation and boost income for
investors. A few local success
stories come readily to mind
though they may not meet the
40:80 threshold (N40 billion
in shareholders funds and
N80 billion in total assets).
The Sahara Group, South
Atlantic Petroleum Limited
(SAPETRO), Folawiyo Group,
Arik Air, BUA Group, Tastee
Fried Chicken, CHI Farms,
Obasanjo Farms, CHISCO
Transport, and the Lekki Con-
cession Company to name a
few. For the foreign compa-
nies they are numerous poten-
tial candidates.
In the end, it should not
be forgotten that in a bid to
achieve a good end the welfare
of Nigerians should be fore-
most. With teams of lawyers,
tax consultants, and consult-
ants, big companies that are
determined to bypass the law
would fnd innovative ways to
restructure their operations so
that they will always stay a few
inches below the imposed ceil-
ing. This is the time for wider
consultation and not populist
sentiment. ;
In January 2010, Sanusi
Lamido Sanusi, the former
governor of the Central Bank
of Nigeria, issued a directive
that required all bank chief
executives that had served for
up to 10 years to leave their
positions by the end of July
that year. Those afected were
Jim Ovia at Zenith Bank,
Tony Elumelu at United
Bank for Africa, and Akinsola
Akinfemiwa at Skye Bank. They
were barred from returning
to the boards of the fnancial
institutions for 3 years.
Four years later, each of
these men have reinvented
themselves. Tony Elumelu
sits atop HEIRS Holdings that
has interests in agriculture,
hospitality, power and real
estate, Akinsola Akinfemiwa
is the chairman of Heritage
Bank, and Jim Ovia, has had a
good run in every race he has
deemed to enter since from
philanthropy to telecoms, and
real estate.
In a testament to the suc-
cession planning at Zenith
Bank, the board announced
his successor, Godwin Eme-
fele, the current CBN gover-
nor, less than a week after the
directive was made public.
Tolu Ogunlesi, a social com-
mentator, describes him as
having the knack for living
beneath the radar, and es-
chewing the barefaced capi-
talist aggression of many of
his billionaire colleagues,
which ensures that he mostly
stays out of controversy.
This week it was announced
that the CBN had approved his
nomination as chairman of the
bank he founded more than 20
years ago. As chairman, Ovia
will not be part of the day-to-
day running of the bank, whose
motto is In your best interest.
Rather, he will be charged with
setting the tone of its strategic
direction at a time of thinning
margins and higher costs. Al-
ways the biggest individual
shareholder of the bank, Ovia
would not be dismayed at the
excellent job his protgs have
done in his absence.
The new chairman has a
strong passion for informa-
tion and communications
technology. He serves as the
president of the Nigerian In-
ternet Group. He is also the
proprietor of the University
of Information and Commu-
nication Technology, Agbor,
Delta State, where he hails
from.
Born on November 4, 1951,
Ovia began his professional
career in 1980 at IMB, a
merchant bank. Seven years
later, he had risen to head the
banks corporate fnance de-
partment. In 1990, he set out
to start Zenith Bank.
He is also the chairman
of Quantum Luxury Prop-
erties Limited, and a sits
on the board of the Africa
Finance Corporation. He is
a Member of the Order of
Federal Republic (MFR), a
national honour. He holds
a B.Sc. degree in Business
Administration from the
Southern University, Loui-
siana (1977), and a masters
degree in Business Adminis-
tration from the University
of Louisiana (1979), both in
the United States. He is an
alumnus of Harvard Busi-
ness Schools Owner/Presi-
dent Management (OPM)
program. ;
Obiora Onyeaso
obiora.onyeaso@customsstreet.com
Should companies be forced to list their shares on the Nigerian Stock
Exchange based on arbitrary numbers such the size of shareholders
funds and the value of assets? The matter is not so straightforward.
FY 2013 (N Bn)
Gross Earnings 335.27
Net interest income 189.26
Operating income 264.47
PBT 110.60
PAT 95.32
EPS 3.01
Zenith Bank 2013 Results
Source: Nigerian Stock Exchange
The Godfather Returns
Aerial view of the Civic Centre and the Civic Centre Towers,
two iconic prime properties in Jim Ovias real estate portfolio
Source: skyscrapercity.com
A.P. Mller Mrsk, the shipping line and terminals operator, could be obliged to list on the NSE
of our lawyers as trusted
advisors and enablers of
transactions, not academics.
We are known to take a
commercial, business driven
approach to law. If you look
at the profles of our lawyers,
you will fnd that a number
of our lawyers have MBAs,
and one of our partners is
currently pursuing a DBA.
We are constantly at work
thinking up new ways of
solving clients problems.
What is OAs client
solving approach?
We believe our clients
come to us for cutting-edge
solutions to intricate legal
problems. We also believe
that each matter needs a mul-
tifaceted approach to fnd
the best solution. According-
ly, whatever the nature of the
instruction, we are insistent
on a cross-functional, rigor-
ous approach when explor-
ing solutions for our clients.
We discourage silo thinking
here. For instance, if a bank-
ing client has a pending case
we will pool resources from
our litigation, and banking
practices to brainstorm on
the matter. Throughout the
process we maintain open
communications with the cli-
ent. This helps in developing
our case management strat-
egy, which is compiled in a
single document for easy ref-
erence when needed by new
team members.
In spite of the govern-
ments eforts to draw
in private sector partici-
pation into power and
infrastructure there is a
strong residue of public
distrust and resentment
over the privatization of
common assets. What is
your view?
One thing we can all
agree on is that the govern-
ment has no business being
in business. That said, it is
understandable that when
people do not fully appreci-
ate the constraints faced by
the government in funding
costly, large-scale socially
benefcial projects like power
and infrastructure all by it-
self, and the attendant op-
portunity cost, there is a ten-
dency to leap to wholesale
condemnation of privatiza-
tion. Knowing the magnitude
of competing demands faced
by state and federal govern-
ments, I will say that privati-
zations, PPPs, and similar
arrangements ultimately
serve the public good when
properly structured. That the
government and sponsors do
not always do a good job of
communicating the ration-
ale of these sales, cannot be
an indictment of the ethos
of these arrangements. Let
us not forget that these same
arrangements were the bat-
tering rams used to disman-
tle the inefcient monopolies
enjoyed by state-sponsored
companies in the past. The
choices and convenience
they have brought have been
a great service. For example,
we all remember the bu-
reaucracy Nigerians sufered
under NITEL until the GSM
licenses were sold. When we
take out sentiment, what we
fnd is that, when properly
executed, deregulation and
indeed, privatisation, has the
potential to deliver benefts
at lower costs to taxpayers
and customers.
Sector-wise, does the
work-mix at the frm
evolve with trends in the
economy?
As a full service frm, we
receive instructions in both
contentious, that is, litigious,
and non-contentious, that
is, advisory, matters from
our clients. Naturally, most
of our advisory work, be-
ing transaction-driven will
refect the push-and-pull of
economic forces. For exam-
ple, during the banking con-
solidation round of 2004-5,
we worked with over 60%
of the fnancial institutions.
Again, in 2009, during the
Central Banks banking sec-
tor intervention we worked
closely with the regulator to
assure fnancial system sta-
bility. As situations arise,
we adapt and ft in, whilst
retaining our core essence. It
is the only way for a frm to
remain relevant and indeed
thrive.
What recent global
M&A transaction would
you have liked to work
on?
That would have to be
the aborted Pfzer-AstraZen-
eca combination. The sheer
scale of the two companies
global operations, multiple
regulatory jurisdictions, and
the size of the ofer gave it
all the tantalizing features of
a transformational deal on
so many levels. In the end,
AstraZeneca shrugged of
the suitors ofers, and Pfzer
chose not to launch a hostile
takeover for AstraZeneca.
If it had gone on a full of-
fensive, one would have liked
to see the creative defensive
structures that AstraZenecas
lawyers would put in place. It
would have been the stuf of
case-study dreams for years
to come. I would have liked
to work on this deal advising
the sell side. ;
What is your role at
the frm?
Until recently, I was part of
the Firms Specialized Trans-
actions Practice. Essentially,
the practice deals with the
most innovative transactions
in the market. Its respon-
sibility is to craft bespoke
solutions to situations that
often have no precedent in
market. For instance, on one
occasion we had a client who
needed fnancing to develop
its upstream petroleum as-
set. After we considered a
number of options, we set-
tled on a forward sale struc-
ture, whereby we presold the
crude reserves to raise the
necessary funds needed to
exploit its proven reserves.
Putting together deals of this
nature is what our Special-
ized Transactions Practice is
known for.
Then about two years ago,
I moved to the Power & In-
frastructure Practice, and
as the name suggests, the
practice focuses on two key
sectors of the economy, in
which we are privileged to
frequently attract the top
mandates. Only last year,
during the privatization of
the Power Holding Com-
pany of Nigeria, Olaniwun
Ajayi LP advised on 9 out of
the 15 privatized assets. We
have also been advising on
the Azura-Edo Independ-
ent Power Project, which is
widely regarded as the tem-
plate for future IPP develop-
ment projects in these parts.
On the infrastructure side,
we are also working with a
client on the development of
a deep seaport to serve Ni-
gerias burgeoning maritime
needs as well as a number of
other major PPP deals.
What qualities charac-
terise Olaniwun Ajayi?
I would say our bias for
technical, intellectually
demanding high-end work.
Olaniwun Ajayis reputation
is not built on the solicitation
of vanilla-category briefs.
We push the envelope of
the law. We advised on the
frst Liquefed Natural Gas
project, the frst utility scale
Independent Power Project,
the frst bond issuance
by International Finance
Corporation and so on. We
do not see ourselves in the
narrow sense of passive
dispensers of legal opinion.
Instead, we like to think
INTERVIEW 3
DEAL ENGINEER
Wolemi Esan
Partner, Power & Infrastructure
Practice, Olaniwun Ajayi LP
About the Firm
D Founded: 1962
0 Number of Partners: 8
B Number of Associates: 65
Education
University College, London (UCL)
Master of Laws (LLM)
Lagos State University
Bachelor of Laws (LL.B.), Law
Recent transactions
Advised on the US$3.15 billion
nancing of Dangote Industries
Limited for the development of a
400,000bpd renery
Advising on the US$1.5 billion
nancing of the development of a
deep seaport in Lagos, Nigeria
Advised on the US$1.2 billion -
nancing of the development of a
fertilizer plant in Eleme, Rivers State
Advising on the on-going devel-
opment of the greeneld Azura-
Edo IPP, a c. 459MW open cycle
gas-red plant in Edo State
Advised on the US$500 million
nancing of an international ship-
ping conglomerate for the expan-
sion of its vessel portfolio
Wolemi Esan is a partner in Olaniwun Ajayi LPs Power and Infrastructure
Practice. He has done extensive work with private companies and public
agencies in a variety of situations that cut across his core practice area,
and other expert verticals. He has a strong background in financial
matters, and is widely acknowledged as a leading authority in derivatives
and securitization in the Nigerian securities market.
VM| Monday, July 21, 2014 | Issue 002
Olaniwun Ajayi law firm library
Our bias for technical,
intellectually demanding high-end
work sets Olaniwun Ajayi apart.
Our clients come to us for cutting-
edge solutions to intricate legal
problems.
MARKET DATA 4
MARKET SNAPSHOT
3-MONTH PRICE TREND OF BELLWETHER STOCKS
LEGEND
ACCESS 9.80
11.31 7.22 PE 6.01
0.00
May June M
14/07 18/07
T W T F
CADBURY 74.25
98.35 58.27 PE 24.50
0.00
May June M
14/07 18/07
T W T F
DANGCEM 240.05
250.02 185.00 PE 20.26
0.95
May June M
14/07 18/07
T W T F
DANGSUGAR 9.30
12.45 8.67 PE 10.33
0.20
May June M
14/07 18/07
T W T F
FLOURMILL 77.87
91.85 63.91 PE 26.76
0.13
May June M
14/07 18/07
T W T F
FO 238.00
259.94 27.06 PE 55.09
3.94
May June M
14/07 18/07
T W T F
GLAXOSMITH 68.99
71.44 53.06 PE 22.62
0.01
May June M
14/07 18/07
T W T F
GUARANTY 30.00
31.80 22.67 PE 9.34
0.03
May June M
14/07 18/07
T W T F
NASCON 10.72
15.10 10.20 PE 10.51
0.68
May June M
14/07 18/07
T W T F
NB 175.61
189.00 140.00 PE 30.38
1.18
May June M
14/07 18/07
T W T F
NESTLE 1125.00
1250.00 916.00 PE 40.06
15.00
May June M
14/07 18/07
T W T F
OANDO 25.00
36.89 9.32 PE 5.45
2.99
May June M
14/07 18/07
T W T F
TOTAL 180.00
188.58 146.26 PE 11.46
8.95
May June M
14/07 18/07
T W T F
TRANSCORP 5.91
5.95 1.17 PE 48.56
0.11
May June M
14/07 18/07
T W T F
UACN 62.12
71.20 53.23 PE 21.32
0.53
May June M
14/07 18/07
T W T F
UBA 8.06
9.58 6.65 PE 5.37
0.21
May June M
14/07 18/07
T W T F
DIAMONDBNK 6.32
8.00 5.86 PE 3.20
0.08
May June M
14/07 18/07
T W T F
FBNH 15.90
18.93 11.50 PE 7.71
0.33
May June M
14/07 18/07
T W T F
FCMB 4.26
4.90 3.01 PE 5.16
0.11
May June M
14/07 18/07
T W T F
FIDELITYBK 1.94
3.10 1.85 PE 7.28
0.06
May June M
14/07 18/07
T W T F
GUINNESS 198.02
266.70 162.00 PE 24.96
6.98
May June M
14/07 18/07
T W T F
INTBREW 29.50
31.00 18.00 PE 32.80
0.00
May June M
14/07 18/07
T W T F
JBERGER 63.00
76.45 59.18 PE 10.31
5.05
May June M
14/07
T W T F
18/07
MANSARD 2.67
2.73 1.95 PE 14.05
0.15
May June M
14/07 18/07
T W T F
PZ 38.50
47.06 30.08 PE 31.36
1.75
May June M
14/07 18/07
T W T F
SKYEBANK 3.40
4.90 3.19 PE 2.81
0.13
May June M
18/07
T W T F
14/07
STANBIC 27.26
27.50 15.39 PE 14.66
0.21
May June M
14/07 18/07
T W T F
STERLNBANK 2.38
2.92 2.09 PE 4.58
0.07
May June M
14/07 18/07
T W T F
UBN 9.23
12.80 8.10 PE 20.45
0.42
May June M
14/07 18/07
T W T F
UNILEVER 52.77
65.00 43.32 PE 41.55
1.27
May June M
14/07 18/07
T W T F
WAPCO 119.01
136.73 87.50 PE 12.63
6.98
May June M
14/07 18/07
T W T F
ZENITHBANK 25.22
27.40 19.23 PE 8.72
0.21
May June M
14/07 18/07
T W T F April May June M
16/06 20/06
T W T F
TICKER 9.80
11.79 7.22 PE 6.24
0.05
1 3
4
9
10
5 6 8
11
7
2
1. 52-week low price
2. Year Low Price
3. Current price
4. Year High Price
5. 52-week high price
6. Current price
7. 5-Day Price Change
8. PE Ratio
9. Daily Prive Movement over 3 months.
10. 30-Day Moving Average
11. Daily Price Movement over Last Week
MOBIL
WEMABANK
NPFMCRFBK
WAPCO
MANSARD
FIDSON
TOTAL
PAINTCOM
PZ
WAPIC
OANDO
COSTAIN
RTBRISCOE
JBERGER
NIGERINS
NASCON
CONOIL
UPDCREIT
DNMEYER
TRIPPLEG
MOST GAINED & DECLINED
20.16%
13.27%
12.24%
6.23%
5.95%
5.33%
5.23%
5.00%
4.76%
4.65%
-10.68%
-8.03%
-7.89%
-7.42%
-7.41%
-5.96%
-5.00%
-4.97%
-4.76%
-4.57%
INDEX DAILY MOVEMENT
Mo Fr
42.70
42.80
43.00
42.90
43.10
42,891.82
Tu We Th Fr
NSEASI
Mo Fr
0.437
0.439
0.443
0.441
0.445
438.71
Tu We Th Fr
NSEBNK
Mo Fr
10.45
10.49
10.57
10.53
10.61
1,059.78
Tu We Th Fr
NSECNSMRGDS
Mo Fr
0.465
0.470
0.480
0.475
0.485
469.09
Tu We Th Fr
NSEOILGAS
VM| Monday, July 21, 2014 | Issue 002
MARKET SNAPSHOT
MARKET DATA 5
CURRENCY CROSS RATES
Currency
codes/
names
United
Kingdom
Pound
Euro
Japanese
Yen
Swiss
Franc
US Dollar
CFA Franc
BCEAO
CFA Franc
BEAC
Chinese
Yuan
Renminbi
Ghanaian
New Cedi
Hong
Kong
Dollar
Nigerian
Naira
Saudi
Riyal
South
African
Rand
US Dollar
Utd. Arab
Emir.
Dirham
GBP 1 0.7902 0.005756 0.6506 0.5841 0.001205 0.001205 0.09476 0.172 0.07537 0.00364 0.1558 0.05466 0.5841 0.1591
EUR 1.2657 1 0.007285 0.8234 0.7393 0.001524 0.001524 0.1199 0.2177 0.09539 0.004607 0.1971 0.06918 0.7393 0.2013
JPY 173.751 137.29 1 113.038 101.488 0.2093 0.2093 16.4637 29.8845 13.094 0.6325 27.0635 9.4965 101.488 27.6361
CHF 1.5373 1.2147 0.008848 1 0.8979 0.001852 0.001852 0.1457 0.2644 0.1159 0.005596 0.2395 0.08402 0.8979 0.2445
USD 1.7121 1.3528 0.009855 1.1139 1 0.002062 0.002062 0.1622 0.2945 0.129 0.006232 0.2667 0.09357 1 0.2723
XOF 830.196 655.957 4.7785 540.106 484.897 1 1 78.6616 142.785 62.5618 3.0219 129.306 45.3732 484.897 132.042
XAF 830.196 655.957 4.7785 540.106 484.897 1 1 78.6616 142.785 62.5618 3.0219 129.306 45.3732 484.897 132.042
CNY 10.5627 8.3461 0.0608 6.8718 6.1694 0.01272 0.01272 1 1.8167 0.796 0.03845 1.6452 0.5773 6.1694 1.68
GHS 5.8899 4.6539 0.0339 3.8319 3.4402 0.007095 0.007095 0.5581 1 0.4439 0.02144 0.9174 0.3219 3.4402 0.9368
HKD 13.2706 10.4866 0.07638 8.6336 7.751 0.01598 0.01598 1.2574 2.2824 1 0.0483 2.067 0.7253 7.751 2.1107
NGN 280.072 221.298 1.612 182.208 163.583 0.3374 0.3374 26.537 48.1694 21.1056 1 43.6223 15.3069 163.583 44.5453
SAR 6.4218 5.0742 0.03696 4.1779 3.7508 0.007735 0.007735 0.6085 1.1045 0.4839 0.02338 1 0.351 3.7508 1.0214
ZAR 18.3123 14.4713 0.1054 11.9136 10.6958 0.02206 0.02206 1.7351 3.1495 1.38 0.06666 2.8522 1 10.6958 2.9126
USD 1.7121 1.3528 0.009855 1.1139 1 0.002062 0.002062 0.1622 0.2945 0.129 0.006232 0.2667 0.09357 1 0.2723
AED 6.2899 4.97 0.0362 4.0921 3.6738 0.007576 0.007576 0.596 1.0818 0.474 0.0229 0.9797 0.3438 3.6738 1
INDEX PERFORMANCE
Date
Week
Opening
Week
Close
Change WtD MtD QtD YtD
1 All Shares Index 42,832.82 42,891.82 59 0.14 0.96 0.96 3.78
2 NSE 30 Index 1,945.69 1,948.74 3.05 0.16 0.88 0.88 2.18
3 NSE Banking Index 438.08 438.71 0.63 0.14 1.35 1.35 -2.04
4 NSE Insurance Index 148.19 150.41 2.22 1.5 2.44 2.44 -1.61
5 NSE Consumer Goods Index 1,053.69 1,059.78 6.09 0.58 0.15 0.15 -3.68
6 NSE Oil/Gas Index 477.63 469.09 -8.54 -1.79 0.18 0.18 38.02
7 NSE Lotus Islamic Index 2,836.03 2,853.38 17.35 0.61 -0.74 -0.74 -0.34
8 NSE Industrial Index 2,705.31 2,767.11 61.8 2.28 3.76 3.76 8.66
MARKET SNAPSHOT
Date Deals
Turnover
Volume
Turnover Value
Traded
Stocks
Advanced
Stocks
Declined
Stocks
Unchanged
Stocks
All Shares
Index Value
1 14.07.2014 5,502 468,559,126 6,200,244,950.37 125 \ 132 27 \ 23 29 \ 30 69 \ 79 42,930.60
2 15.07.2014 5,692 251,758,465 3,003,431,717.63 114 \ 117 33 \ 27 27 \ 32 54 \ 58 42,971.56
3 16.07.2014 5,098 317,158,558 3,060,821,383.87 120 \ 122 22 \ 29 26 \ 18 72 \ 75 43,030.27
4 17.07.2014 4,904 365,252,261 4,432,207,242.48 114 \ 124 27 \ 28 25 \ 20 62 \ 76 42,918.52
5 18.07.2014 4,778 374,304,901 3,207,141,742.24 117 \ 122 34 \ 24 21 \ 31 62 \ 67 42,891.82
DATA PARTNER DATA VIZUALIZATION
TRADING BREAKDOWN BY SECTOR
Sector %
Financial Services 73 \ 72
Conglomerates 8 \ 13
Oil & Gas 8 \ 6
Others 11 \ 9
WEEK-TO-DATE RETURN
-15% -10%
-40%
-20%
-30%
-10%
0%
+10%
+20%
+30%
+40%
+50%
+60%
+70%
+80%
+100%
+90%
+120%
+130%
+140%
+110%
+150%
-5% 0% +15% +10% +5% +25% +20%
Y
E
A
R
-
T
O
-
D
A
T
E

R
E
T
U
R
N
LAGGING
SLIPPING LEADING
IMPROVING
43
44
47
3
6
7
8
9
10
11
12
13
15
18
19
22
25
26
27
29
31
32
34
37
1
2
4
177
20
21
24
99
30
1
33
35
38
3
39
40
16
5
45
46
41 42
44
14 11111111
23
4
11
36
28
48
# TICKER WTD YTD
1 DANGCEM -3.60 10.05
2 NB 0.54 3.89
3 GUARANTY 1.25 10.92
4 NESTLE 1.84 -7.50
5 ZENITHBANK -0.36 -8.72
6 FBNH 2.72 -0.43
7 WAPCO 0.93 -2.58
8 GUINNESS 5.55 -13.14
9 ETI -0.58 6.30
10 STANBIC 1.20 26.70
11 UBA -0.63 -11.80
12 FO 16.98 139.40
13 OANDO -1.79 15.42
14 TRANSCORP 10.69 33.33
15 ACCESS 0.93 2.08
16 UNILEVER -6.36 -4.28
17 FLOURMILL 0.00 -10.34
18 UBN 0.52 0.21
19 PZ 0.55 2.84
20 CADBURY -0.34 -9.80
21 UACN -6.68 -8.08
22 DANGSUGAR -2.15 -22.22
23 INTBREW 0.34 2.79
24 DIAMONDBNK -2.50 -15.10
25 JBERGER -1.38 3.55
26 FCMB -4.82 12.47
27 ASHAKACEM 12.24 55.07
28 GLAXOSMITH 1.47 1.47
29 7UP 0.00 43.60
30 TOTAL -0.04 0.62
31 FIDELITYBK 0.00 -25.65
32 STERLNBANK 0.43 -7.60
33 MOBIL -0.04 13.83
34 CONOIL 0.31 -3.43
35 SKYEBANK -2.10 -25.68
36 PRESCO 2.87 -1.14
37 OKOMUOIL 0.00 -25.00
38 CAP 1.30 -19.50
39 NEIMETH -8.33 -3.97
40 MAYBAKER 5.99 -27.76
41
All Shares
Index
-0.46 3.64
42 NSE 30 Index 0.03 2.02
43
NSE Lotus
Islamic Index
-0.74 -0.95
44
NSE Industrial
Index
-0.69 6.23
45
NSE Consumer
Goods Index
0.73 -4.23
46 NSE Banking Index 0.17 -2.18
47
NSE Oil/Gas
Index
4.99 40.53
48
NSE Insurance
Index
-0.55 -3.06
The relative size of each individual stocks bubble
chart is determined by its market capitalization.
For indices, the relative size of each bubble chart
is the total value of the capitalization modifed
values of each constituent stock.
Pink bubbles represent individual stocks, and grey
bubbles represent indexes.
The \ arrow signifes week-on-week change in value. This weeks value is shown on the left of the \ sign, and last weeks value on the right.
2820
2825
2830
2835
2840
14/07 18/07 16/06
11.6
11.8
12.0
12.2
12.4
FGNBond Index
Market Value
YTD Return
www.afrinvest.com www.customsstreet.com
VM| Monday, July 21, 2014 | Issue 002
RESEARCH
Earnings Weatherman
Conglomerates Analyst Coverage
International Coverage
Rocket Launcher
Sector Company
Afrinvest 12-Month
Target Price
Rating
Banking
Access Bank 11.8 ACCUMULATE
Diamond Bank 11.19 BUY
ETI 19.4 ACCUMULATE
FBN Holdings 22.17 BUY
Skye Bank 5.95 BUY
Sterling Bank 3.02 BUY
UBA 10.41 BUY
Zenith Bank 28.88 ACCUMULATE
Consumer Goods
Dangote Sugar 11.97 BUY
Flour Mills of Nigeria 96.20 ACCUMULATE
Insurance
AIICO 1.70 BUY
Mansard 3.29 BUY
Continental Reinsurance 1.48 BUY
Custodian and Allied
Insurance PLC
4.37 ACCUMULATE
Oil & Gas Total 267.69 BUY
It is report card time. Any time now companies are due to start releasing their half-year re-
sults. If the latest results from Unilever, the consumer goods company, are anything to go by,
then investors should prepare themselves for a bloody earnings season.
30-Jun-14 30-Jun-13 Change
N N
Revenue 29,280,133,000 29,667,942,000 -1%
Cost of Sales (18,280,715,000) (18,812,681,000) -3%
Distribution/
Admin and Other Expenses
(8,315,277,000) (6,514,759,000) 28%
Other Income 6,189,000 1,322,000 368%
Financial Charges (677,846,000) -496,625,000 36%
Financial Income 64,851,000 117,676,000 -45%
Proft Before Tax 2,077,335,000 3,962,875,000 -48%
Taxation (612,762,000) (1,222,025,000) -50%
Proft After Tax 1,464,573,000 2,740,850,000 -47%
In reality, pleasant earnings
surprises could turn out to be
the exception. Most investors
expect most companies to put
up a least-evil performance.
The question now is whether
the dampened half year re-
sults will signify an isolated
blip on the screen or mark a
tempering of business per-
formance till after the 2015
elections. Two events, both
outside the control of execu-
tives, constitute fies in their
ointment. Political concerns
about the forthcoming elec-
tions, and the growing threat
of Boko Haram attacks in the
southern part of the country.
According to DaMina
Advisors, the private sector
is already reeling from high
operating costs due to erratic
electricity supplies, and the
unbudgeted costs of new
security infrastructure for
major airlines, telecom com-
panies, banks, gas stations,
commercial buildings and
other manufacturing indus-
tries, will erode the proft-
ability of the many stressed
companies.
UNILEVER NIGERIA PLC
UBA Capital has published a helpful calendar of dates when companies released their results
in 2013. It should serve as a guide for when they are likely to announce their results. Analysts at the
frm also wrote that they expect some quite impressive results from some of our preferred stocks.
Companies
H1 2013 Results
Publication Date
Current UBA
Capital Target Price
Current UBA
Capital Rating
Access Bank Aug-21 12.3 BUY
Dangote Cement Jul-16 255.0 BUY
Diamond Bank Jul-31 9.5 BUY
FBN Holdings Aug-27 16.6 BUY
Fidelity Bank Jul-26
Forte Oil Jul-26
Guaranty Bank Aug-20
Mobil Nigeria Jul-30
MRS Aug-15
Oando Aug-16
Skye Bank Jul-24 4.6 BUY
Stanbic Bank Jul-30
Sterling Bank Jul-18
UBA Jul-29
Union Bank Jul-31
WAPCO Jul-29 120.0 BUY
Zenith Bank Aug-15 28.0 BUY
Analysts at Afrinvest have a fair quantity of BUY recommendations too.
It is not often that sea-
soned analysts use gushing
adjectives to describe com-
panies. But that is just what
the analysts at Cardinal-
Stone Partners have done.
They describe Transcorps
investment case as very
compelling as it presents an
excellent opportunity into
Nigerias emerging utilities
sector. They rate the stock a
BUY with a 2014 target price
of N6.62.
The National Associa-
tion of Securities Deal-
ers (NASD) announced
this week that it will provide
an Equity Analyst section on
its website where research
reports on Over the Counter
(OTC) securities will be avail-
able. This is a welcome step.
It is expected that the NASD
will be able to attract reputa-
ble analysts, and not pump-
and-dump artists, to cover its
companies.
The NSE has had a similar
relationship with Thaddeus
Investment Research & Advi-
sors to provide coverage for
less visible companies not
covered by sell-side analysts
at bulge bracket frms.
At the start of the year,
Bola Ajomale, chief execu-
tive of NASD, disclosed that
it was targeting over 230
companies to be traded on its
platform.
In its July recommenda-
tion list, Imara African Secu-
rities places BUY recommen-
dations on all four securities
included: Access Bank,
Dangote Sugar Refnery,
Lafarge Cement WAPCO,
and UAC.
Transcorp chairman, Tony Elemelu (second from left) rings the bell at the NSE,
while Obinna Ufudo, CEO, (first from left) and NSE officials applaud
Satchets of Omo, a Unilever product, sold in a street corner stall
At Renaissance Capital, analysts are bullish on the banking sector. All nine fnancial insti-
tutions under its coverage - Access Bank, Diamond Bank, Fidelity Bank, First City Monument
Bank, First Bank, GT Bank, Skye Bank, Stanbic IBTC, and Zenith Bank have BUY recommen-
dations. Skye Bank has the highest price upswing potential at more than 100%.
COMMENTARIAT 6
VM| Monday, July 21, 2014 | Issue 002
Rocket Internet plans an
initial public ofering in Frank-
furt in the third quarter. The
company behind JUMIA, the
online retail store, is expected to
be valued at between 3bn and
5 billion. Founded by Oliver,
Alexander and Marc Samwer,
three German brothers, Rocket
Internet aims to become the big-
gest consumer internet group
outside the US and China.
CORPORATES
New Listing
Board Changes FCMBs Consumer
Lending Muscle
BDC Capital Raising
Helios Bond Issuance
United Kingdom, 71%
Europe, 16%
South Africa, 8%
Asia, 4%
Middle East
& North Africa, 4%
Helios BondIssue Final Allocation
Source: Bank of America Merrill Lynch
Notore Chemical In-
dustries, a nitrogenous ferti-
lizer producer, plans to list its
shares on the Nigerian Stock
Exchange. According to sourc-
es, the company has already
approached the NSE with a
formal request. Notore is the
only producer of urea fertilizer
in sub-Saharan Africa.
In November 2007, Emerg-
ing Capital Partners, a pri-
vate equity frm, took a stake in
the company. The listing may be
an avenue for it to sell down its
stake. Other companies in ECPs
portfolio include Continental
Reinsurance and Oando.
During the week, Continental
Reinsurance Plc informed the
NSE of a possible divestment by
ECP Africa Fund II PCC and its
partners (the ECP Fund II Con-
sortium) of their interests in the
company. ECP invested in the
company in February 2007.
Sterling Bank has notifed
the NSE of the resignation
of three of its directors. They
are Alhaji (Dr.) S.A. Adegun-
wa, who until his retirement
served as chairman, Alhaji
Bashir Borodo, OON, and
Mr. Yemi Idowu. Mr. Asue
Ighodalo becomes the new
chairman. He is the co-found-
er of Banwo and Ighodalo, a
respected City law frm that
enjoys long standing relation-
ships with some of Nigerias
biggest companies. He sits
on the boards of the Nigerian
Economic Summit Group,
Dangote Flour Mills Plc,
Christopher Kolade Founda-
tion, FATE Foundation, Main
Street Technologies Limited
(sponsor of MainOne Cable
Company), Union Bank (UK)
Plc and Nigeria Leadership
Initiative (NLI). Ighodalo is
a veteran deal adviser and it
would be interesting to see
him put his rich experience
to work at the One Customer
Bank.
The appointment was made
at the banks board meeting
held on July 8, 2014.
FCMB Group plans to
raise up to $300 million of
funding this year to boost
consumer lending by about
20 per cent to N540 billion.
Ladi Balogun, the chief ex-
ecutive ofcer, expressed a
strong bias for tapping the
loan markets as opposed to
bond markets due to more
stable pricing.
Asue Ighodalo, chairman,
Sterling Bank
Ladi Balogun,
Group CEO, FCMB Group
Two hundred bureau-de-
change have successfully
raised their capital to N35
million in compliance with
the new guidelines issued by
the Central Bank of Nigeria.
This was disclosed by God-
win Emefele, the governor of
the Central Bank of Nigeria,
during at a hearing before
the House of Representatives
Committee on Banking and
Finance.
In recent weeks, BDC op-
erators under the aegis of
the Association of Bureau
De Change of Nigeria have
embarked on a public aware-
ness campaign and legislative
lobbying to persuade the apex
bank to rescind its decision.
BDCs have until July 31 to
meet the new capital require-
ment.
The CBN governor decried
abuses among BDC operators
whose businesses had be-
come characterised by rent-
seeking, weak operational
structure, fnancing of illicit
transactions, gradual dol-
larisation of the economy and
multiple ownership of BDC
licences.
He explained that a regu-
latory overhaul is overdue to
stem these abuses.
Professor Akpan Ekpo,
director-general of the West
African Institute for Finan-
cial and Economic Manage-
ment (WAIFEM) has advised
the regulator to tread with
caution because the N35
million fgure is high, and
the time window too short.
These could have unplanned
consequences on the stable
supply of forex to businesses
and individuals that need to
purchase currencies for legiti-
mate uses.
On July 8, Helios Tow-
ers Nigeria (HTN) priced a
US$250m 5NC3 RegS senior
unsecured high yield bond.
Bank of America Merrill
Lynch acted as sole bookrun-
ner, lead manager and rat-
ings advisor. HTN is a lead-
ing telecoms towers operator
in Nigeria with approximate-
ly 1,200 towers across 34 out
of 36 Nigerian states
The company plans to use
proceeds for the ofering to
refnance the existing, ex-
pensive senior and subordi-
nated indebtedness, as well
as extend the companys debt
maturity profle, optimize its
capital structure and estab-
lish a liquid benchmark for
the companys future debt
raisings.
The bond sale is historic in
a number of ways. It is the frst
time that a non-commodity
Sub-Saharan Africa corporate
issuer and frst Sub-Saharan
Africa telco outside South Af-
rica will be selling bonds, and
the lowest ever coupon for an
inaugural Nigerian corporate
issuance at 8.375%.
The fnal allotment by re-
gion shows the spread of ap-
petite for Nigeria-exposed
companies in attractive sec-
tors.
Uniform Mortgage
Underwriting
Standards
Mortgage loans as % of GDP
UK, 81%
USA, 73%
South Africa, 32%
India, 5.8%
Brazil, 5.5%
Russia, 2.7%
Nigeria, 0.55%
Source: Dunn Loren Merrifeld Source: Central Bank of Nigeria
The importance of uniform
mortgage underwriting stan-
dards across the diferent
states jurisdictions has been
emphasized by Sonnie
Ayere, chief executive of the
Nigerian Mortgage Ref-
nance Com pany. He was
speaking at a two-day workshop
with the theme Uniform
Underwriting Standards for
Mortgage Loans. Four states,
Kogi, Abia, Enugu, and Akwa
Ibom, have expressed their
interest to participate in the
standardization of terms for
access to mortgages. NMRC
is a secondary mortgage
fnancing institution. The
company was launched by
President Goodluck Jonathan
in January 2014.
Oando
Wins the Medal
Oando Energy Resources
Inc. (OER), a Toronto-listed
E&P company, has completed
the acquisition of Medal Oil
Company Limited. OER issued
3,491,082 units of one common
share and one-half of one war-
rant for each Medal Oil share.
The total consideration was $5
million. Medal Oil holds a 5%
interest in OML 131, a deep-
water license covering 297,600
acres. ConocoPhillips owns the
remaining interest in the block.
Godwin Emefele, the
Central Bank of Nigeria gov-
ernor, is slowly learning the
importance of Centralbank-
ese, a unique language spoken
by central bankers around the
world. It is noted for its abil-
ity to obfuscate listeners, be-
ing non-committal, and never
revealing what the speaker
plans to do. Alan Greenspan
once said that if I seem undu-
ly clear to you, you must have
misunderstood what I said.
Emefele has got of on the
wrong foot. Shortly after he
resumed ofce, he called a
big press conference to say
exactly what he plans to do.
Thankfully, he has kept mar-
kets guessing about exactly
how he plans to achieve those
goals: lower interest rates, a
stable exchange rate, and free
capital fow.
Next week, he chairs his
frst monetary policy com-
mittee meeting (MPC).
Analysts do not expect that he
will cut rates anytime soon.
Alan Cameron, a London-
based economist at CSL,
who was polled by Reuters
explained that we do not see
any chance of rates being cut
at Julys MPC, much less as
infation continues to creep
up ahead of elections.
REGULATORY
Waiting
on Mr. Emeele
2014
April May June
Inter-Bank Call Rate 10.50 10.63 10.63
Minimum Rediscount Rate (MRR)
Monetary Policy Rate (MPR) 12.00 12.00 12.00
Treasury Bill Rate 11.26 10.13 9.98
Savings Deposit Rate 3.42 3.41 3.42
1 Month Deposit Rate 8.19 8.27 8.46
3 Months Deposit Rate 9.38 9.42 9.30
6 Months Deposit Rate 10.07 9.76 9.52
12 Months Deposit Rate 9.69 9.29 9.19
Prime Lending rate 16.70 16.50 16.50
Maximum Lending Rate 25.63 25.76 26.07
Money Market Indicators (In Percentage)
COMMENTARIAT 7
VM| Monday, July 21, 2014 | Issue 002
ConocoPhillips Acreage Facility
OML 131 deepwater oil block
HIGH TABLE
ART AS AN ALTERNATIVE INVESTMENT
The Raw Deal
Raw meat is not for every-
one. Since the invention of fre
by Paleolithic man, many fnd
the consumption of unprepared
meat unconscionable. Boiled,
fried, grilled, steamed, and just
about any other heat applica-
tions is preferred to raw meat.
But do we go too far in the
preparation of meat draining
out all its soul in the process?
In Nigeria, our obsession to
attain a parasite destruction
guarantee by boiling beef and
chicken to its second death
is common. Meat is left too
long in a boiling pot, which
extricates all the nutrients,
and favour in it. Not satis-
fed, most cooks go further to
certify the meat ofcially dead
by incubating it in a brothy
soup or stew. Then they rely
almost completely on its stock
to breathe new life into it.
However through the course
of history and spanning dif-
ferent parts of the world, raw
delicacies have emerged for
numerous reasons; practical or
otherwise.
An example dates back to
1950 in Venice, where an ail-
ing aristocratic lady went to
dine at the famous Harrys
Bar. When Giuseppe Cipriani,
the owner, was informed that
his guest was on strict medi-
cal instructions to have only
uncooked meat, he went ahead
to shave thin slices of raw beef,
which he served it with mus-
tard sauce. He named it Car-
paccio because the dish resem-
bled the red hues and tones of
the painter Vittore Carpaccio
whose works were being exhib-
ited in Venice at the time.
Closer to home in Africa
are the Ethiopians, swear
by kitfo, an African steak
tartare, served with local
Ethiopian spices and cheeses,
and tere sega, a ceremonial
dished served at weddings.
Anthropologists suggest that
due to the numerous wars
in the Abyssinian region,
soldiers ate their meat raw as a
protective measure. Had meat
been cooked in war time the
smoke and smell would alert
their enemies.
There are several examples
of raw food consumption from
around the world. Ceviche
(seafood cooked in the citric
acid of lime), crudo, an Ital-
ian version of ceviche, steak
tartare, and of course, sushi,
perhaps the most famous of
raw diets.
Originally from Japan, the
combination of rice and raw
fsh (sushi) was borne out of
necessity. The vinegary rice
was initially used as a pickling
agent for the fsh. Sushi as we
know it today evolved as a
freshwater delicacy during the
Edo dynasty (1603 - 1868).
In Nigeria, Bungalows Res-
taurant, which has a mouth-
watering 20-page menu,
including sushi ofers an au-
thentic izakaya (Japanese
pub) experience.
I ordered the Salmon nigiri,
my sushi of choice in Lagos.
The chef did not disappoint.
I would also recommend the
sushi at Fusion Restaurant and
the Avenue Suites. Although it
has been a while, the greyish
tint of the last salmon nigiri
I ordered once at Bonzai on
Akin Adesola Street in Victoria
Island leaves me scared to rec-
ommend it. The slightest per-
ception of contamination with
raw food is enough to make an
unsold diner run for the hills,
especially in Naija!
But my top pick for sushi
would have to be Izanagi. Since
it opened in June 2012, it has
built a reputation for giving
VIP service to its regulars.
For the faint hearted diner, a
salmon roll is probably a good
entrance dish to the world of
raw sushi. It is an easy entre es-
pecially if you have had smoked
salmon since the texture is simi-
lar. A note of caution though.
The taste is markedly diferent.
The combination of the sweet
vinegary rice with the silky deli-
cious fsh is a taste once acquired
can be highly addictive.
So order up and welcome
the advent of Japanese restau-
rants in Lagos. The cleaner,
healthier Lagosian palate is
here to stay. ;
Ify Oji
is a lawyer, writer and food
lover. She is the creator of the
GidiTang.com (synonym: Lagos
Flavour) blog on food and drink
in Lagos.
teamlogiclimited@gmail.com
Avenue Suites
1390 Tiamiyu Savage Street,
Victoria Island
Bungalows Restaurant
1296 Akin Adesola Street,
Victoria Island, Lagos
Fusion Restaurant
1C, Ozumba Mbadiwe Street,
Victoria Island, Lagos
Izanagi Japanese Cuisine
19B Idejo Street, Victoria
Island, Lagos
EDITOR: MIDENO BAYAGBON
GROUP BUSINESS EDITOR:
OMOH GABRIEL
CONTENT DIRECTION:
OBIORA TABANSI ONYEASO
DESIGN & ILLUSTRATION:
PUBLICAN MEDIA
Vanguard Markets features unbiased, in-depth coverage of corporate
and market developments across a wide range of business sectors.
Every week, Vanguard Markets delivers essential business analysis and
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markets.
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Vanguard Media Limited,
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Website: www.vanguardngr.com
ISSN 0794-652X
Published by
In Association With
Last week, on Art as an Al-
ternative Investment, we took
a look at the top ten sales of
Nigerian art. The 2014 edi-
tion of Africa Now, organized
by Bonhams, an international
auction house, featured 120
lots from established names
including Ben Enwonwu, Yu-
suf Grillo, El Anatsui, and
Bruce Onobrakpeya. The most
valuable sale was a 1976 oil
painting Princes of Mali by
Ben Enwonwu at 92,500.
As new records are set for
Nigerian and African art on
the international market, it is
imperative to examine the in-
dices that determine the value
of an artwork; authentic-
ity, quality, rarity, condition,
provenance and value. These
factors must be considered all
at once in order to make an
informed decision when pur-
chasing a work, They may be
broadly categorized into three.
Economic
The laws of supply and de-
mand are generally applicable
to the sales of art. Rarity tends
to enhance value. Works by
prolifc artists tend to be less
valued than those of artists
who produced less. Likewise,
works by deceased artists are
generally more sought after.
The rarity of a given work is
also determined by how many
similar examples exist. For
example, a painting is usually
worth more than a print or a
lithograph while a surplus of
artworks by a particular art-
ist tends to cause a reduction
in market price. However, if
collectors suddenly become
active as a result of a change
in perceptions or their mate-
rial circumstances, the market
price tends to rise. Therefore,
the value of art fuctuates de-
pending on how keen collec-
tors are and how much they
are willing to pay for a piece.
Work
The quality of a given work,
its aesthetic merits, its signif-
cance within a larger context
of artistic history and within
the specifc context of an art-
ists oeuvre, contribute to its
overall value.
The period in which a work
was created is another factor
in determining its price. Ap-
praisers generally value works
completed early in an artists
career higher than those com-
pleted later, as early works
tend to be more unpredict-
able, daring and passionate,
owing to the artists desire to
establish a strong reputation.
Works of art that typify an
artists aesthetic are also ap-
praised higher than those un-
characteristic of his oeuvre.
Enwonwus most expensive
work sold to date, the Daily
Mirror fgures are fne ex-
amples of his aesthetic and
are representative of his well-
known elongated, lithe forms,
as well as geometric shapes
borrowed from classical Afri-
can sculpture.
Other factors include the size
of a work and medium of execu-
tion. Generally, larger works of
art are valued higher because of
the degree of difculty involved.
Sculptures in wood, bronze,
metal or stone are also consid-
ered more valuable than paint-
ings. Traditional paint media
like oil is valued higher than
acrylic and watercolor, which
in turn are usually worth more
than prints or lithographs.
The condition and the
provenance of an artwork
impact a given works value.
For example, a painting that
is ripped, water-damaged,
discoloured, or extensively
repaired may be signifcantly
reduced in value. Works of art
formerly owned by famous
people usually command
high prices, while established
provenance like certifcates of
sale, exhibition and publication
history help resolve questions
of authenticity, art-historical
importance and enhance value.
Artist
Artists who are well-known
and enjoy a rich history of col-
lection mostly command more
value than artists who are un-
known. Several reasons can be
adduced; education, years of
practice, recognition including
prizes and awards, profession-
al afliations, publications,
and exhibitions in signifcant
galleries and museums.
In conclusion, collections
formed with passion and intel-
ligence stand the test of time,
both aesthetically and mon-
etarily. In building a collec-
tion that has huge investment
potential, one must keep in
mind its high liquidity factor,
or marketability the rela-
tive ease to sell all or part of
the collection quickly and thus
convert its value into cash. ;
A Short Guide to
Collecting Art
Ben Enwonwus Seven
wooden sculptures
commissioned by the
Daily Mirror in 1960.
Sold for 361,250 incl.
premium
ARENA 8
VM| Monday, July 21, 2014 | Issue 002
Oliver Enwonwu
is the director of leading Lagos
gallery, Omenka and president of
the Society of Nigerian Artists.
oliver@omenkamagazine.com
Salmon nigiri dish