Transcorp trades at multi-year highs - CNBC Africa

Transcorp trades at multi-year highs

Western Africa

by Dara Rhodes 0

Transcorp Hilton Abuja hotel. PHOTO: Getty images

The conglomerate has a varied base of shareholders with almost 300,000 investors with prominent investors such as the Pan African investment company, Heirs Holding Limited. Their portfolio includes investments in Agribusinesses, hospitality and energy sectors.

“Very interesting times for Transcorp and for [our] shareholders if I must say but not surprising based on all of the things we’ve been seeing and trying to do since the beginning of the year,” Obinna Ufudo, CEO at Transcorp told CNBC Africa.

The acquisition of the power plant has led to renewed demand as discerning investors are beginning to take notice of Transcorp’s work and the company is now trading at 3.95 naira per share.

“For the nine months of this year, we’ve made 5.1 billion naira in profits before tax and if you compare it to the fact that we made 3.9 billion for all of last year I think it’s a pointer for certain investors, therefore I’m not surprised at what is happening to the Transcorp shares at this time,” he said.


With Transcorp’s recent takeover of the Ughelli Power plant in the southern state of Delta, on 1 November, the company’s shares have seen a 95 per cent increase in the last two weeks. 

“We take long term views when we invest in sectors. For the power sector, for the short run, there are gains to be made, and also in the long run, there is also much to be made,” he explained.

When Transcorp took over the Ughelli power plant, the plant was producing about 160 megawatts however, Ufudo is confident that by August next year, they would be able to boost the output to about 650 megawatts.

“That’s like five times over what we met on ground. In the long run, over the next three to five years, our target is to take this plant to a minimum of 1,500 megawatts,” he added.

While the company has also began discussions with the Nigerian Stock Exchange to draw up the forecasts for next year’s numbers, Ufudo is certain the numbers will be in multiples.

“In terms of revenues, we expect to make the most for next year from our energy business. We have actually taken over the plant now so you can say that we already know what is going to happen next year.”

Even so, key investments are being made in the other sectors as they have just signed an agreement with Hilton Hotels & Resorts to build a 300-room hotel in Lagos and by the first quarter of next year, another agreement will be signed to build 300 rooms in Port Harcourt.

“These are more long term in nature, in terms of when to expect revenues from those businesses, so yes in the short term we expect our energy business to overtake our hospitality business,” he said.