The NASD Over-the-Counter Securities Exchange Plc has unveiled the NASD Enterprise Portal, which is targeted at addressing the incomplete record of the Nigerian capital while providing informed market data.
The firm said currently the market capitalisation to the Gross Domestic Product ratio in Nigeria was as low as seven per cent, which it described as “non exhaustive” owing to the exclusion of the FMDQ and NASD markets data.
Addressing newsmen at the launch of the portal to stakeholders in Lagos, the Managing Director/Chief Executive Officer, NASD OTC Securities Exchange, Mr. Bola Ajomale, said in South Africa, the market capitalisation to the GDP ratio was 322 per cent, which was above Nigeria’s.
According to him, South Africa has a comprehensive data on its enterprises; while for Nigeria, the lack of formal information on enterprises and their capital is the order of the day, adding that most enterprise activities in the country are outside formal market coverage.
The effects of enterprise information gap, Ajomale noted, included “inaccurate and incomplete data on investment opportunities; significant enterprise activity outside formal investor coverage; private equity works harder to find investment opportunities; due diligence and peer comparison is more difficult and expensive.
“Capital raising by enterprise is outside regulatory oversight, primary and secondary investments may range between $3m and $10m, and social media capital raising will become the norm.”
Speaking on its effects on the capital market, the NASD boss said enterprise would resort to bank debt, which often does not support growth.
“Only the weak eventually approach the capital market, and there will be continued disconnect with the capital market and its requirements weaken corporate governance in would-be growth enterprise,” he added.
He described the platform as a matching service that could encourage greater transparency in the value and growth segment of the economy; and a controlled data exchange enabling research efficiency while presenting structured information on performance, operations and investment opportunities.
NASD Plc obtained a Securities and Exchange Commission no-objection to diversify into this service in November 2017, the firm said, adding that the portal would be launched in the first quarter of 2018.
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