Listing in the stock exchange can be favourable for a company. There are some pharmaceutical companies in Nigeria stock exchange listing (NGX Group). Listing involves company shares being offered on the list, or board of stocks to be traded officially in the stock exchange.
Listing in the stock exchange allows a company’s shares to be offered to the public through initial public offerings (IPO). The initial offering can be through offer for subscription or offer for sale.
Apart from Initial Public Offering, there are other listing ways in Nigeria stock exchange. Example, listing by Introduction for companies that have raised enough capital prior to listing. Dual Listing is for companies that want to be listed in both NGX Group and another exchange.
Reverse acquisition/merger/takeover is another listing method when an unlisted private/public business acquires a majority share in a company already listed in the NGX Group.
In some circumstances, the stock exchange can delist a company. This means the removal of the stock of the company from the list, which means no investor will be able to trade shares of the stock. Delisting might be due to the company going bankrupt, and failure to satisfy the terms of listing.
Other reasons might be the company becoming a subsidiary after merging or acquisition.
Private companies are not listed on the stock exchange, and their shares can only be traded privately or over the counter.
Pharmaceutical Companies in Nigeria Stock Exchange
The Nigeria Stock Exchange or Nigerian Exchange Group (NGX Group) Plc is the official regulatory body in Africa largest economy. Their activities are regulated by the Nigerian Securities and Exchange Commission. As of December 2021, there are 375 securities listed in the exchange. The market cap stood at N41.6tn
The NGX offers three opportunities for businesses. The Growth Board is for small-cap companies looking for funding. The Main Board is for well-established businesses, and the Premium Board is for elite businesses that can maintain strict compliance with the regulation of the NGX.
NGX allows foreign investors to be listed as dealers, while also encouraging foreign investors to participate.
The rules and regulations concerning the operation of the NGX Group can be found in the NGX Rulebook
There are currently seven (7) pharmaceutical companies listed on the floor of the Nigerian Stock Exchange.
| PHARMACEUTICAL COMPANIES | DATE LISTED |
|---|---|
| FIDSON HEALTHCARE PLC | April 6, 2008 |
| GLAXO SMITHKLINE CONSUMER NIG. PLC | |
| MAY & BAKER NIGERIA PLC. | November 10, 1994 |
| MORISON INDUSTRIES PLC. | |
| NEIMETH INTERNATIONAL PHARMACEUTICALS PLC | September 21, 1979 |
| PHARMA-DEKO PLC. | |
| PZ CUSSONS NIGERIA PLC | |
Earlier on, two other pharmaceutical companies, Evans Medical Plc and Nigerian-German Chemicals Plc, were available in the listing. They were delisted on July 3, 2020.
Advantages of Listing a Pharmaceutical in the Nigeria Stock Exchange
- Listing a company will help them to achieve brand exposure and recognition
- It also means the company has gone public and can become a member of the NGX All-Share Index (with incentives)
- A listed company has more access to funding by many investors.
- It also proves the accountability of the company. All the companies listed must meet the rules and regulations of the body.
- Although stocks are uncertain assets and can cause loss of money, it can increase considerably in the long run, bringing huge returns of investment.
- Lenders and financial institutions are more likely to borrow to companies listed in the stock exchange, as they can use the listed securities as collateral.
