1. Retail views
UBA Q4 results
Nigeria Tuesday, 20 January 2015
Daily Retail Report
.
Market Review
Going from strength to strength, the Benchmark index garnered
more gains as investors sentiment remain positive. NSEBNK closed
in the green on the backdrop of the MPC meeting just concluded;
the naira is not to be devalued. OILG and CNSM lost most points as
Nestle(-2.87%), Seplat(-1.93%) and 7-Up(-1.17%) shed prices.
In the broad market, decliners thumped advancers 37 to 21 leaving
37 issues unchanged. Market activity level in terms of value traded
appreciated by 20.69% from that of the previous. Top worst
performers were OkomuOil(N23.90), RTBriscoe(N0.76) and Union
Dicon(N13.23) while GTB(N20.73), UBN(N9.03) and UPL(N4.00) led
the gainers’ list.
Brief report from the MPC meeting:
1. The MPR remains unchanged at 13% as voted by 11
members of the committee.
2. The CRR (cash reserve ratio) on private sector funds remains
unchanged at 20%.
3. The CRR on public sector funds remains unchanged at 75%.
4. The LR(liquidity ratio) remains unchanged at 30%
We maintain that investors should engage defensive stocks with
healthy performance. Access, OkomuOil, UACN and Dangote
Cement look attractive for this week.
Sector Report Today(%) Month-To-Date(%) Year-To-Date(%)
NSE30 0.33 -14.35 -14.35
NSE BNK10 2.16 -12.64 -12.64
NSE CNSM10 -0.64 -13.34 -13.34
NSE OILG5 -0.14 -4.25 -4.25
NSE INS10 1.07 -7.37 -7.37
Market Wrap
ASI +0.15 29,819.39
Index year-to-datee -12.63
Market Cap. N9.932Tril
Traded value 4.135Bn
Key gainers (%)
GUARANTY 5.28
GUINNESS 4.37
DANGSUGAR 1.33
ZENITH 1.16
FO 1.14
Key losers (%)
DANGFLOUR -4.90
NESTLE -2.87
TRANSCORP -1.32
HONYFLOUR -3.08
ACCESS -2.86
NITTY
1M 10.1256
2M 11.4433
3M 11.8761
6M 14.9320
9M 15.3081
12M 16.6118
Crude oil spot price
Brent crude US$48.76
Contact information
Phone: 01-2713923; 01-2713920
Mobile: 08068015502
Email: cslservice@fcmb.com
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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 5.10 11.00 116% 1.60 1.90 0.35 0.80 7.10% 11.5% 22883.00 Dec.
DIAMOND BANK Buy 4.13 8.10 96% 2.00 1.70 0.30 0.60 5.40% 5.4% 14475.00 Dec.
FIDELITY BANK PLC Buy 1.34 3.00 124% 0.30 0.50 0.14 0.30 7.40% 11.6% 28974.00 Dec.
FBN HOLDINGS Hold 7.50 14.70 96% 2.20 2.30 1.10 0.80 10.00% 10.0% 32632.00 Dec.
GUARANTY TRUST BANK Buy 20.72 39.80 92% 3.20 3.30 1.45 2.20 6.90% 7.3% 29431.00 Dec.
STANBIC HOLDINGS Hold 25.99 15.50 -40% 1.90 2.60 1.20 3.10 2.70% 3.5% 10000.00 Dec.
STERLING BANK Hold 2.47 2.70 9% 0.40 0.40 0.25 0.80 10.90% 8.7% 21592.00 Dec.
SKYE BANK Hold 2.20 5.00 127% 1.20 1.10 0.30 0.30 11.10% 20.7% 13219.00 Dec.
U B A Hold 3.78 7.40 96% 1.40 1.50 0.50 0.70 10.10% 10.1% 32981.00 Dec.
ZENITH BANK Buy 17.50 31.50 80% 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 5.35 Under review N/A 0.89 1.20 0.60 4.70 7.40% 7.4% 12000.00 Dec.
CADBURY NIG. Under review 39.90 Under review N/A 2.90 3.20 1.30 7.60 0.00% 4.7% 1878.00 Dec.
FLOUR MILLS Hold 36.30 54.80 51% 2.90 3.50 1.60 8.90 3.30% 4.0% 2385.00 Mar.
HONEYWELL FLOURMILLS Buy 2.00 5.20 160% 0.40 0.30 0.17 12.00 5.70% 4.7% 7930.00 Mar.
NESTLE FOODS NIG. Hold 2.95 821.80 27758% 28.10 31.30 24.00 24.90 2.60% 3.0% 792.00 Dec.
P Z INDUSTRIES Hold 25.11 34.60 38% 1.20 1.30 0.19 7.80 2.70% 3.0% 3970.00 May
U A C N Buy 34.14 72.60 113% 2.90 3.60 1.75 5.40 4.00% 4.7% 1920.00 Dec.
UNILEVER NIGERIA PLC Sell 32.80 31.80 -3% 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 82.00 Under review N/A 9.40 9.40 3.30 8.20 3.30% 3.3% 3001.00 Mar.
DANGOTE CEMENT Buy 155.00 258.50 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 131.50 111.00 -16% 7.90 5.90 7.00 14.50 4.30% 3.0% 1506.00 June
INTERNATIONAL BREWERIES Hold 21.89 24.50 12% 0.90 1.30 0.30 16.20 1.00% 1.5% 3263.00 Mar.
NIGERIAN BREWERIES Sell 145.50 121.20 -17% 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 23.90 41.50 74% 2.20 3.00 1.00 9.00 3.20% 6.7% 953.00 Dec.
PRESCO PLC Buy 29.70 42.70 44% 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 40.00 78.60 0.97 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
MPC Preview - Reasons to expect a post-election devaluation
The Central Bank of Nigeria’s (CBN) Monetary Policy Committee (MPC) is stuck between a rock and a hard place. In an environment of plunging oil
prices, it has (quite sensibly) done its best to keep domestic liquidity tight, to contain the demand for hard currency, to smooth out volatility in the
FX market and to eliminate opportunities for arbitrage.
Nevertheless, domestic liquidity (as shown below) is still abundant, spreads between official and interbank rates continue to be large (touching
13% yesterday), and FX reserves have fallen another US$2.6bn in the two months since the last MPC meeting. As the conventional policy tools
monetary policy – the policy rate, cash reserve requirements – reach their limit, the CBN is facing some difficult choices.
In our view, these choices boil down to: (a) implementing further MPR and CRR hikes, but with diminishing marginal returns; (b) using FX reserves
to close the gap between the official and interbank markets, for as long as it can afford to do so; (c) allowing a further devaluation of the exchange
rate, reducing both the benefits of arbitrage and the drain on FX reserves. Our sense is that MPC will opt for option (b) until elections, and option
(c) after them.
News Headlines
SEPLAT gets January 30 deadline for takeover of Afren: As the initial deadline given to the Nigerian independent exploration and production
(E&P) company, SEPLAT Petroleum Development Company, to indicate whether or not it intends to make a firm offer for the takeover of the United
Kingdom-listed Afren Plc, expired on Monday, the company has received an extension to the deadline. Source: thisdaylive.com
FG plans review of tariffs, waivers to boost local production: The federal government has concluded plans to review tariffs and waivers-
granting as part of efforts to boost local production as well as further improve capacity utilisation of manufacturing companies in the country in
the new year. Last year, with the various industrial sector resuscitation funds released by the federal government taking full effect, the nation’s
capacity utilisation rose from 46% to around 52%. Source: punchng.com
UK, EFCC probing govs, ministers for fraud: The Chairman, Economic and Financial Crimes Commission, Mr. Ibrahim Larmorde, has said that
the commission and the United Kingdom’s Metropolitan Police are investigating some serving and former governors, ministers, heads of service of
the federation, and federal lawmakers. The EFCC Chairman made the comment while playing host to the Metropolitan Police Special Crime and
Operations Unit led by Detective Chief Inspector Jonathan Benton in Abuja, on Monday. He said, “You are also very much aware that the
Metropolitan Police Proceeds of Corruption Unit is the unit that assisted us in the case of DSP Alamieyeseigha in the past, Joshua Dariye, and of
course the big one that everybody is aware of, James Ibori, who is currently serving a jail term in the United Kingdom. Source: punchng.com

4. Daily Retail Report
Page 4
Retail views
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