Sep 3 (Lagos) - Shares of Flourmills of Nigeria Plc (
FLOURMILL ) took a nosedive today by dropping almost 10% after the stock went ex-dividend.
The dividend payment is N 1 per unit but the stock fell more N 2.35 today at the close. Shareholders who collected their dividend will not be happy about it now that they lost even more at the end of the day.
Shareholders were not happy with the most recent results posted by the Company. The company posed excellent results right up to the rights issue and suddenly posted disappointing results post the rights issue. The people who exercised their rights at N 30 per unit will be ruing their decision now. It is unfortunate reality of investing in Nigerian stocks that these stocks are more often than not offered at highly inflated valuations and SEC or whoever is in charge seem to be a lame duck.
The
FLOURMILL stock has collapsed from N 38 per unit in March to N 21.95 today. That is a decline of 42% and a worrisome development for the Company's shareholders.
Historically this stock used to trade well above 80 Naira per unit in the 2012-14 period but then it entered a bearish period which does not seem to be coming to an end.
The Company is one of the biggest players in the Nigeria food manufacturing sector but the Company faces big competition from other Companies which may be more innovative.
reporting for easykobo.com on Monday, Sep 3 2018 from Lagos, Nigeria