Nigeria seeing a cautious approach in the market - CNBC Africa

Nigeria seeing a cautious approach in the market

Western Africa

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“I think what has been driving the market for the past few months is caution. If you see the volatility – upward, downward movements – I think it just shows you that people are cautious and are trying to make sure they’re buying into good companies at good prices. But as half year results come in, my sentiments towards the market is upbeat, positive,” Anyanwu told CNBC Africa on Friday.

The Nigeria All Share Index closed up 0.15 per cent to 37,382.49 points on Friday. Zenith Bank was a major gainer along with UACN, Nigerian Breweries and Ashaka Cement while the losers on the day included GlaxoSmithKline, Cadbury, Dangote Cement and Okomu Oil.

Anyanwu feels that a number of banks add value to the local market and these include the likes of Zenith as well as First Bank of Nigeria (FBN) and Fidelity Bank.

“I’ve always been favourably disposed to the banking sector. We’re still looking at Zenith Bank, we think Zenith has the capacity to trade at about 27, 28 which, for us, has a lot of value. We still see about 30 per cent upside from here. Zenith Bank comes in pretty well on our watch list,” he said.

“FBN is also there, we think FBN is currently trading at a discount in valuation so I think we are looking at First Bank, Zenith and Fidelity Bank.”

He also feels that Ecobank Transitional Incorporated (ETI), who acquired Oceanic Bank at the end of the 2012 financial year, is one of the banks investors should be keeping an eye on.

“Right after ETI acquired Oceanic, I think investors are beginning to price that in. I think it’s a bigger bank in the Nigerian banking space – that is exactly what investors are looking at. I think one still needs to pay attention to how they fully integrate Oceanic into the ETI system,” said Anyanwu.