BUSINESS

NGX: Royal Exchange Drops By 10% Due To Large Sell-Off

Royal Exchange Insurance Plc was caught in between a bulls-bear struggle in the equities segment of the Nigerian Exchange as its market value dropped by 10%.

Year to date, the company has lost some 34% of its market valuation.

The insurance company’s valuation declined to N2.778 billion at a unit price of 54 kobo. In 2022, Royal Exchange shareholders fund declined significantly as the group sustained another loss.

With a more than 29% free float rate, the company is open to strategic investors willing to position except for the fact that its earnings have been on a decline.

Detail from its financial statement showed that its shareholders’ fund declined by 30% to N2.904 billion in 2022 from N4.143 billion 12-month earlier, resultant effect of its poor performance.

Data from the local bourse indicates that Royal Exchange has 5.145 billion outstanding shares and is one of the cheapest listed entities in the market.

Substantial shareholders comprise 17.58% interest by Dantata Investment and Securities company limited, 5.19% stake held by Chief Sunny Odogwu while Helen and Troy Holdings command 5.97% of the outstanding shares.

Its directors control 42.72% of the entire company’s valuation as of December 2022. This means that more than 71% of the control is internally managed.

Currently, the company is trading below the N18 billion capital base proposed by regulators.

In 2022, the group reported that its loss widened to N1.345 billion amidst a tough operating environment. This represents a significant increase when compared with an annual loss after tax of N554.789 million in the comparable period in 2021.

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The group comprises Royal Exchange General Insurance, Royal Exchange Finance Company Ltd., Royal Exchange Healthcare and Royal Exchange Microfinance Bank.

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