What are the benefits of listing a company on the Nigerian Stock Exchange (NSE)? Does it really serve or have any benefits at all? These questions and more are what we have chosen to answer in this post.
The Nigerian Stock Exchange services the largest economy in Africa and is championing the development of Africa’s financial markets. The NSE, a registered company limited by guarantee, was founded in 1960 and it is licensed under the Investments and Securities Act (ISA) and is regulated by the Securities and Exchange Commission (SEC) of Nigeria.
The Exchange offers listing and trading services, licensing services, market data solutions, ancillary technology services and more.
Benefits of Listing Your Company on the Nigerian Stock Exchange
Access to growth-enabling capital
Companies can raise capital to finance strategic business objectives, both at the time of admission as well as through subsequent capital events, providing the stability required to achieve growth aspirations.
Broader diversification of financing options
Listed companies enjoy a wider range of financing options and access to a diverse global investor base and large pool of public funds to finance growth. These companies are also able to use their quoted shares as currency to support acquisition and growth objectives.
Access to long term financing at competitive rates
The Nigerian Stock Exchange provides access to competitively priced financing options for companies seeking capital for growth, expansion and strategy execution.
Higher public profile and visibility
Listed entities are focal points for sell and buy-side firms looking at global peer groups across all sectors. Listed companies benefit from a higher profile and visibility engendered by increased coverage from research analysts, investment banks, the media and investors, as well as potential inclusion in market indexes.
Enhanced transparency and integrity
Being listed enhances the company’s status and credibility with business partners, customers and employees owing to the rigorous disclosure and governance standards required.
Enhanced share liquidity and valuation
A public quotation provides an avenue for placing an objective market value on the business, as well as creating a liquid market for trading the company’s shares to unlock value.
Enhanced incentives to improve employee performance
Listing offers enhanced value in share option schemes which can help to incentivize longterm motivation and performance of employees and executives – potentially enabling listed companies to attract and retain the best talent.
Business sustainability and continuity
Going public institutes good corporate governance and sound business processes that assist in enhancing the company’s longer-term prospects and survival.