What Dangote IPO signals – NGX Chairman

Kwairanga, Chairman of the Nigerian Exchange Group (NGX Group), says the Dangote Petroleum Refinery Initial Public Offering (IPO) signals Nigeria’s readiness to support large-scale capital raising through its capital market.

Mr Kwairanga said this on the sidelines of Fintech Money 20/20 Middle East at the Riyadh International Conference Centre, Saudi Arabia, on Wednesday.

The News Agency of Nigeria (NAN) reports that the NGX Chairman said the significance of the Dangote Refinery IPO was beyond the size of the transaction.

“It demonstrates the capacity of the Nigerian capital market to support businesses of substantial scale,” he said.

According to him, the offer will enable businesses to raise long-term capital, broaden ownership and provide institutional and retail investors with opportunities to participate in their growth.

“The Dangote Petroleum Refinery IPO sends an important signal about the capacity and ambition of Nigeria’s capital market.

“The significance goes beyond the size of the transaction,” he said.

Mr Kwairanga said the transaction could encourage other large Nigerian and African businesses to consider the capital market as a credible avenue for financing growth.

He said this was particularly important as Nigeria’s market infrastructure and accessibility continued to improve.

The NGX chairman made reference to the transition to T+1 settlement, extended trading hours and Nigeria’s return to the FTSE Russell Frontier Market universe from 21 September as key developments.

He said the developments were helping to create a deeper and more investable capital market capable of connecting companies with capital at scale.

Mr Kwairanga said NGX was also working to ensure that major public offers were accessible to everyday Nigerians through multiple distribution channels.

He explained that investors could participate in public offers through stockbrokers, banks and approved digital platforms, with NGX Invest providing infrastructure connecting issuers to the distribution channels.

He said the initiative was aimed at broadening ownership of Nigerian businesses and creating opportunities for younger and first-time investors to participate in the country’s economic growth.

On attracting more Gulf investors to Nigeria, Mr Kwairanga said the country offered significant opportunities in financial services, telecommunications, energy, infrastructure and industrial development.

He said attracting such capital required market accessibility, liquidity, regulatory certainty and confidence that investments could move efficiently into and out of the market.

According to him, improvements in foreign exchange liquidity, T+1 settlement and extended trading hours have enhanced the accessibility of the Nigerian market.

He said the return of Nigeria to FTSE Russell’s Frontier Market universe would also provide an important boost to the market’s international visibility.

Mr Kwairanga called for stronger relationships between the Nigerian market and Gulf sovereign wealth funds, asset managers, family offices and other institutional investors.

READ ALSO: Dangote Petroleum Refinery IPO opens for subscription

He said greater visibility for Nigerian companies and increased direct engagement would help create a stronger Nigeria-Gulf investment corridor.

“For me, the opportunity is to build a stronger Nigeria-Gulf investment corridor, connecting significant pools of Gulf capital with credible Nigerian businesses and investment opportunities,” he said.

The NGX chairman also emphasised the importance of investor protection as more Nigerians increasingly access the capital market through mobile devices.

He said NGX Regulation provided independent oversight, surveillance of trading activities, enforcement of market rules and mechanisms for handling investor complaints.

Mr Kwairanga said transparency and investor education were equally critical to protecting investors and sustaining confidence in the market.

He cautioned that digital access to investment opportunities did not eliminate investment risks, urging first-time investors to use regulated channels and understand the securities they were buying.

“Technology can widen participation, but trust is ultimately what sustains a capital market,” he said.