Forte Oil joins league of high-priced stocks

As part of its plans to improve liquidity and deepen the market, the Nigerian Stock Exchange (NSE), having concluded its review of the prices of stocks, has announced that Forte Oil Plc. has been added to the league of High-Priced Stocks with effect from Wednesday, July 02 2014.

High Priced Stocks are securities that have traded an average of N100 or more per share in four of the preceding six-month period.

Justifying the inclusion of Forte Oil Plc., Mr. Abimbola Babalola, head of market surveillance at the exchange said that a review of trading activities of the company in the last six months show that the company met the criteria set by the Exchange.

“It can be recalled that the Exchange commenced the pilot programme in September 2012 with nine stocks: Dangote Cement, Guinness Plc., Nestle Plc., Nigerian Breweries, SIM Capital Fund, Skye Shelter Fund, Nigerian Energy Sector Fund (NESF) and Total Plc. The Programme became permanent in 2013 and the nine initial pilot stocks remained,” Babalola said.

He revealed that Lafarge Cement WAPCO Nigeria Plc. became the 10th stock on the programme in April 2014, while Seplat Petroleum Development Company Plc. was added in the same month as the 11th stock, because it was a new security listing that was priced above N100.00 at the time of its listing on the exchange.

“With this development, Forte Oil Plc has now become the 12th stock on the programme. We have observed that the prices of these High Priced Stocks have been rather stable with none falling below the N100 mark which is currently the benchmark” he added.

Mr. Ade Ewuosho who heads the market operations of the NSE, confirmed that “way back, to move the price of any stock upwards or downwards, the brokers needed to have a volume of 50,000 shares and above”.

According to him, this changed in September 2012, when the exchange “introduced a pilot programme for its new market structure with the rollout of market making, where stockbrokers could move prices of some high priced stocks with 10,000 shares.”

In a statement signed by Nwando Ajene, head, corporate communication, NSE, stockbrokers would be able to move the prices of Forte Oil Plc. in addition to the existing high-priced stocks, with 10,000 units, from Wednesday July 02, 2014.

However, only the 12 high-priced stocks are currently set with a market trade quantity of 10,000; all the other stocks are set to 50,000.