MTN Nigeria’s Stock Soars 20% Amid Capital-Raising Success

MTN Nigeria Communications Plc (MTN Nigeria) has witnessed a significant rally in its share price, climbing over 20 percent month-to-date as of January 10, 2025.

The stock, which now trades at N242, marks a strong recovery from its November 2024 low of N170. This resurgence reflects renewed investor confidence, bolstered by the company’s strategic capital-raising efforts and proactive measures to navigate challenging macroeconomic conditions.

The rally comes against the backdrop of a tough 2024, during which MTN faced considerable foreign exchange pressures. According to its earnings report for the nine months ending September 30, 2024, the company’s net foreign exchange losses surged by 90.8 percent year-over-year, reaching N904 billion. These challenges weighed on its stock performance for much of the year, with its share price declining steadily after hitting a peak of N281 in January 2024.

In response to these hurdles, MTN Nigeria implemented strategic financing measures, notably its N250 billion Commercial Paper Issuance Programme. Between November and December 2024, the company issued six series of commercial papers (Series 11 to 16), each targeting N50 billion. These issuances were met with overwhelming demand, including Series 13 and 14, which raised N72.18 billion—144 percent above the initial target. The commercial papers offered attractive yields of 27.50 percent for 181-day tenors and 29.00 percent for 265-day tenors. Stanbic IBTC, along with other financial institutions such as Quantum Zenith Capital and CardinalStone Partners, managed the programme.

The capital-raising initiatives proved instrumental in stabilising the company’s finances and restoring investor confidence. As a result, MTN’s share price rebounded sharply, climbing by over 40 percent between December 2024 and early January 2025. This recovery was further fuelled by strong market activity, with over 13 million shares traded in early January.

The company’s stock performance over the past year highlights its resilience and adaptability. At the start of 2024, MTN’s shares traded at N264, reaching N281 by the end of January. However, macroeconomic challenges and foreign exchange struggles led to a gradual decline, with the stock dropping to N222 in February and bottoming out at N170 in November. The turnaround began in December, coinciding with the success of its capital-raising efforts, and has continued into January 2025.

As MTN Nigeria’s share price now approaches the N281 resistance level it reached a year ago, the company’s focus on innovation and financial resilience remains at the forefront. Its ability to attract substantial investor interest, as demonstrated by the oversubscription of its commercial paper issuances, underscores its strong market position. With this momentum, MTN is well-positioned to sustain growth and navigate Nigeria’s dynamic economic landscape in the year ahead.