Besides, they noted that there is a need to consider a downward review of the Monetary Policy Rate to enable listed firms to enhance profitability and increase investors’ access to the stock market.
Average Foreign Portfolio Investment per month rose to N85 billion in 2017, as against N43 billion recorded in 2016. The value of Foreign Portfolio participation in equity trading in the NSE hit N851 billion as of October 2017, representing a 60.8 per cent higher than N517.55 billion recorded for the full year ended December 2016.
According to them, if the FG fails to make forex available to foreign investors to repatriate their dividends, it would not only push local investors away from multinationals operating in Nigeria, it would also, increase the quantum of unclaimed dividends in the capital market.
“Again, foreign portfolio investors are not active in the equities market because of the forex issue. The economy has been struggling. The underlying earnings of listed firms are not doing well and future cash flow is not strong. According to him, if the interest rate is reasonably low, listed firms can borrow a long-term loan, improve profitability and make more investment in the stock market.“If the interest rate is high, it would not be lucrative to investors to invest in the capital market when compared to the money market but if it is reasonably low, listed firms can go to the banks, borrow money and inject into the businesses and make a profit.
With unstable policies?No way!