1. Retail views
UBA Q4 results
Nigeria Wednesday, 7 January 2015
Daily Retail Report
.
Market Review
NSE sustained the negative momentum that has prevailed the
equity market all week. A bloodbath was witnessed amongst
Banking counters, not surprisingly though – the FG had as at
yesterday, reiterated its directive to MDAs to close all revenue
accounts with Deposit Money Banks, worsening investors’
sentiments that have been on pessimistic note since the start of the
year. Relentless selling activities was witnessed across sectoral
board as BNK was down by 7.47%,CNSM down by 3.01% and IND
down by 2.58%.
Overall market breadth was in the favour of decliners which
thumped advancers in the ratio of 52:8; while 36 remained
unchanged. Among the broad indices, NSE All Share Index
depreciated 4.17% at the closing bell to return 31,167.54bpts,
bringing year-to-date index to 10.42%. Activity level in terms of
volume traded rose marginally by 4.84% while Value traded hovered
around N5.3billion. Top in the positive territory are Presco(N27.47),
PZ(N26.50) and WEMA(N0.93), while Guinness(N141.74),
Zenith(N15.44), GTB(N21.96) and Oando(N16.15) led the decliners.
While cautious trading is advised, aggressive investors can look to
take advantage of current weakness in stock prices.
Sector Report Today(%) Month-To-Date(%) Year-To-Date(%)
NSE30 -4.46 -11.51 -28.74
NSE BNK10 -7.47 -16.25 -33.76
NSE CNSM10 -3.01 -9.7 -28.02
NSE OILG5 -1.52 -11.93 8.73
NSE INS10 0.29 -0.66 -4.08
Market Wrap
ASI -4.17 31,167.54
Index year-to-datee -8.36
Market Cap. N10.318Tril
Traded value 5.462Bn
Key gainers (%)
PRESCO 10.19
PZ 5.24
FO 3.01
WAPIC 1.69
ASHAKACEM 0.51
Key losers (%)
GUINNESS -9.74
ZENITHBANK -9.71
GUARANTY -9.70
DIAMOND -9.46
FBNH -5.90
NITTY
1M 12.1409
2M 12.6275
3M 12.9100
6M 13.3940
9M 14.6596
12M 15.4575
Crude oil spot price
Brent crude US$50.92
Contact information
Phone: 01-2713923; 01-2713920
Mobile: 08068015502
Email: cslservice@fcmb.com
Open Account: Click here to register

2. Daily Retail Report
Page 2
Retail views
Stock Recommendations
Banking Comment
Current
Price
Target
Price
Potential
Upside %
EPS
FY
2013
1 Yr
forward
EPS
Last
Dividend
(N)
P/BV
2013
Yield FY
2013
Yield FY
2014e
Shares
Outstanding
(millions)
Year
End
ACCESS BANK Hold 5.74 11.00 92% 1.60 1.90 0.35 0.80 7.10% 11.5% 22883.00 Dec.
DIAMOND BANK Buy 4.69 8.10 73% 2.00 1.70 0.30 0.60 5.40% 5.4% 14475.00 Dec.
FIDELITY BANK PLC Buy 1.60 3.00 88% 0.30 0.50 0.14 0.30 7.40% 11.6% 28974.00 Dec.
FBN HOLDINGS Hold 7.81 14.70 88% 2.20 2.30 1.10 0.80 10.00% 10.0% 32632.00 Dec.
GUARANTY TRUST BANK Buy 21.96 39.80 81% 3.20 3.30 1.45 2.20 6.90% 7.3% 29431.00 Dec.
STANBIC HOLDINGS Hold 27.99 15.50 -45% 1.90 2.60 1.20 3.10 2.70% 3.5% 10000.00 Dec.
STERLING BANK Hold 2.49 2.70 8% 0.40 0.40 0.25 0.80 10.90% 8.7% 21592.00 Dec.
SKYE BANK Hold 2.30 5.00 117% 1.20 1.10 0.30 0.30 11.10% 20.7% 13219.00 Dec.
U B A Hold 3.79 7.40 95% 1.40 1.50 0.50 0.70 10.10% 10.1% 32981.00 Dec.
ZENITH BANK Buy 15.44 31.50 104% 3.00 3.00 1.75 1.30 8.10% 8.3% 31396.00 Dec.
Food & Beverage
EV/EBITDA (x)
2013
Yield FY
2013e
DANGOTE SUGAR REFINERY Under review 5.53 Under review N/A 0.89 1.20 0.60 4.70 7.40% 7.4% 12000.00 Dec.
CADBURY NIG. Under review 42.00 Under review N/A 2.90 3.20 1.30 7.60 0.00% 4.7% 1878.00 Dec.
FLOUR MILLS Hold 35.38 54.80 55% 2.90 3.50 1.60 8.90 3.30% 4.0% 2385.00 Mar.
HONEYWELL FLOURMILLS Buy 3.46 5.20 50% 0.40 0.30 0.17 12.00 5.70% 4.7% 7930.00 Mar.
NESTLE FOODS NIG. Hold 945.82 821.80 -13% 28.10 31.30 24.00 24.90 2.60% 3.0% 792.00 Dec.
P Z INDUSTRIES Hold 26.50 34.60 31% 1.20 1.30 0.19 7.80 2.70% 3.0% 3970.00 May
U A C N Buy 30.60 72.60 137% 2.90 3.60 1.75 5.40 4.00% 4.7% 1920.00 Dec.
UNILEVER NIGERIA PLC Sell 33.80 31.80 -6% 1.30 1.60 1.25 13.70 3.80% 3.8% 3783.00 Dec.
Building Materials EPS 2013e
EV/EBITDA(x)
2013e
Yield FY
2013e
LAFARGE WAPCO PLC Under review 80.02 Under review N/A 9.40 9.40 3.30 8.20 3.30% 3.3% 3001.00 Mar.
DANGOTE CEMENT Buy 171.48 258.50 N/A 11.80 11.90 7.00 16.10 3.40% 3.5% 17040.00 Dec.
Breweries EPS 2013e
EV/EBITDA(x)
2013e
Yield FY
2013e
GUINNESS NIG. Sell 141.74 111.00 -22% 7.90 5.90 7.00 14.50 4.30% 3.0% 1506.00 June
INTERNATIONAL BREWERIES Hold 21.00 24.50 17% 0.90 1.30 0.30 16.20 1.00% 1.5% 3263.00 Mar.
NIGERIAN BREWERIES Sell 139.82 121.20 -13% 5.70 5.60 4.50 13.30 2.90% 2.1% 7562.00 June
Agriculture EPS 2013e
EV/EBITDA (x)
2013e
Yield FY
2013e
OKOMU OIL Buy 25.46 41.50 63% 2.20 3.00 1.00 9.00 3.20% 6.7% 953.00 Dec.
PRESCO PLC Buy 27.47 42.70 55% 1.29 1.60 0.10 9.20 0.40% 1.7% 1000.00 Dec.
Pharmaceuticals EV/EBITDA (x)
2013
Yield FY 2013
GLAXOSMITHKLINE BEECHAM NIG. Buy 42.79 78.60 0.84 3.10 4.30 1.30 8.90 2.50% 3.8% 957.00 Dec.
Note – for full report on the recommended stocks kindly send an email to cslcsu@firstcitygroup.com

3. Daily Retail Report
Page 3
Retail views
Top Highlight
UBA’s right issue opens
UBA’s (Hold, target price N7.40) rights issue opened on Monday, 29 December 2014. The bank is offering 3,298,138,756 ordinary shares
(compared with 32.9bn shares outstanding) on the basis of 1 new ordinary share for every 10 ordinary shares at N4.0/s, notably higher than
yesterday’s closing price of N3.98/s.
The rights if successful, could raise as much as N13.2bn (US$67.7m). According to management, proceeds of the offer will be used to expand the
bank’s e-banking channels, upgrade its technology platform, refurbish the bank’s business offices, and grow risk assets.
We have believed for some time that UBA was among three major Nigerian banks running short of capital (see CSL Nigeria’s Largest Banks – The
Capital Cycle, 1 Aug 2014) and we are of the view that the immediate effect of the rights issue will be to raise the bank’s capital adequacy ratio
(CAR) to meet regulatory requirements post Basel II implementation.
Capital requirements have become stringent. Apart from the fact that banks are expected to take a charge under Basel II/III for operational risk,
the Central Bank of Nigeria (CBN) had in August 2014 mandated that collective impairment and non-distributable regulatory reserves, and other
reserves, be excluded from tier-2 capital. The CBN also stipulated that exposure to the oil and gas sector in excess of 20% will attract a higher risk
weighting.
In addition, with effect from March 2015, systemically important banks (SIBs) in Nigeria (which includes UBA) would be required to set aside
Higher Loss Absorbency (HLA) or additional capital surcharge of 1% to their respective minimum required CARs which are expected to be met with
tier-1 common equity
News Headlines
Power: Residential consumers to pay more from July: The increase in electricity tariffs will become effective for all categories of consumers in July
this year. This means that residential consumers, who constitute about 80 per cent of power users in the country, will from that date pay the new
rates. According to the Nigerian Electricity Regulatory Commission, the bulk of the power consumers would have started paying higher tariffs from
the first day of this year if not for the freezing of the increased rates for residential users for a six-month period. Source: punchng.com
Close revenue accounts with banks, FG orders MDAs: The Federal Government on Tuesday directed all its Ministries, Departments and
Agencies to close their revenue accounts with Deposit Money Banks latest by February 28. The balances in the revenue accounts, it said, should
be transferred to the Consolidated Revenue Fund of the Federal Government. Source: punchng.com
Declining Revenue: Banks to Slow down State Governments' Borrowing: The dwindling revenue to the federation account owing to the declining
crude oil prices may hinder state governments from securing loans from Nigerian banks and other multilateral institutions as banks have already
resolved to stop lending to them to forestall a debt crisis. The Coordinating Minister for the Economy and Minister of Finance, Ngozi Okonjo-Iweala,
had called for enhanced monitoring of borrowing by state governments as a response to the decline of over N100 billion in monthly gross revenues
flowing into the federation account since July last year. Source:thisdaylive.com
Saudi set to price out Nigeria, Angola on crude: Nigeria and her African counterpart, Angola, are having their problems arising from the
dwindling prices of crude oil further compounded, as Saudi Arabia made deep cuts to its monthly oil prices for European buyers, while it trimmed
prices for U.S. refiners and increased rates for Asia. Almost half of Nigeria’s cargoes due to be exported in January are still available. The backlog
has pushed Nigerian oil differentials versus Brent to their lowest since at least 2009 BFO-QUA at 65 cents a barrel, down 80 percent since May,
said Reuters. And it is also creating a discount frenzy between African and Gulf oil producers to Asian buyers. Source: businessdayonline.com

4. Daily Retail Report
Page 4
Retail views
Important Risk Warnings and Disclaimers
CSL STOCKBROKERS LIMITED (CSLS) is regulated and authorized by the Securities and Exchange Commission (SEC) of Nigeria and the Nigerian Stock Exchange (NSE). The
details of the authorization can be viewed at the SEC Website at http://www.sec.gov.ng/consolidated-list-of-capital-market-operators.html and at the NSE Website at
http://www.nse.com.ng/Regulation/ForBrokers/Pages/Dealing-Members.asp.
RELIANCE ON THIS NOTE FOR THE PURPOSE OF ENGAGING IN ANY INVESTMENT ACTIVITY MAY EXPOSE YOU TO A SIGNIFICANT RISK OF LOSS. By receiving this
document, you will not be deemed a client or provided with the protections afforded to clients of CSLS. When distributing this document, CSLS or any member of the First City Group
is not acting for any recipient of this document and will not be responsible for providing advice to any recipient in relation to this document. Accordingly, CSLS will not be responsible
to any recipient for providing the protections afforded to its clients.
If you are in the UK, the protections of the Financial Services and Markets Act 2000 (FSMA) or Financial Conduct Authority (FCA) do not apply to any investment activity engaged in
as a result of this communication; and any resulting transaction would not fall within the jurisdiction of any FSMA or FCA dispute resolution or compensation scheme. By accepting
this document you confirm that you are so aware of the above stated. If you do not accept the above stated and/or if the distribution of this document is otherwise unlawful where you
are, you are required to return the document immediately to CSLS.
This document is not an offer to buy or sell or to solicit an offer to buy or sell any security. This document does not provide individually tailored investment advice. It has been
prepared without regard to the individual financial circumstances and objectives of persons who receive it. The appropriateness of a particular investment will depend on an investor’s
individual circumstances and objectives. The investments and shares referred to in this document may not be suitable for all investors.
CSLS is a member of the FCMB Group Plc (“the Group”), a group of companies which includes First City Monument Bank Ltd., FCMB Capital Markets Ltd, First City Asset
Management and FCMB UK. Either CSLS or any other member of the Group may effect transactions in shares mentioned herein, may take proprietary trading positions in those
shares, and may receive remuneration for the publication of its research and for other services. Accordingly, this document may not be considered as objective or impartial.
Additionally, information may be available to CSLS or the Group, which is not reflected in this material. Further information on CSLS’ policy regarding potential conflicts of interest in
the context of investment research and CSLS’ policy on disclosure and conflicts in general are available on request.
This document is based on information obtained from sources it believes are reliable but which it has not independently verified. Neither CSLS nor its advisors, directors or
employees make any guarantee, representation or warranty as to its accuracy, reasonableness or completeness and neither CSLS nor its advisors, directors or employees accepts
any responsibility or liability whatsoever (in negligence or otherwise) for any loss howsoever arising from any use of this document or its contents or otherwise arising in connection
with this document. The opinions contained in this document are subject to change without notice and not to be relied upon and should not be used in substitution for the exercise of
independent judgment.
Past performance is not a guarantee of future performance. Investments may go down in value as well as up and you may not get back the full amount invested. Where
an investment is denominated in a currency other than the local currency of the recipient of the research report, changes in the exchange rates may have an adverse
effect on the value, price or income of that investment. In case of investments for which there is no recognized market it may be difficult for investors to sell their
investments or to obtain reliable information about its value or the extent of the risk to which it is exposed.
The information contained in this document is confidential and is solely for use of those persons to whom it is addressed and may not be reproduced, further distributed to any other
person or published, in whole or in part, for any purpose.
© CSLS 2013. All rights reserved
CSL STOCKBROKERS LIMITED
Member of the Nigerian Stock Exchange
First City Plaza, 44 Marina,
PO Box 9117,
Lagos State, NIGERIA