…Series 1 of FCMB-TLG private debt fund opens for investment
More investors were on the sell-side of the Nigerian equities market on Monday, which pushed the market down by 0.09 percent as this week’s trading opened. The market’s negative close pushed the return year-to-date (YtD) lower to 33.28 percent. The Nigerian Exchange Limited (NGX) All-Share Index (ASI) and Market Capitalisation decreased from preceding trading day’s 99,743.05 points to 99,656.38points.
The SEC approved FCMB-TLG Private Debt Fund opened for investment on Monday. The Fund is sponsored and managed by FCMB Asset Management Limited (FCMBAM) as the Fund Manager, with technical support from TLG Capital Investments Limited (TLG Capital), United Kingdom. The Fund seeks to raise N10 billion under Series 1 of its N100 billion programme size. FCMB-TLG Private Debt Fund is Nigeria’s first Naira-denominated Private Debt Fund.
The Fund’s Series 1 Offer for subscription which opened to Qualified Institutional Investors (QIIs) and High Networth Individuals (HNIs) closes on Wednesday 31 July 2024.
Lagos-based Vetiva analysts said the equity market remains under pressure, as investors pursue safety in the fixed income space amid attractive yield. They said that given the strong buy-side reaction “we saw in the market last week, we expect to see a reversal in sentiment this week, as investors seek to lock in gains recorded last week”. Meanwhile, in line with their expectation the market traded lower in Monday’s session.
“We expect the negative sentiment to persist in the equities market as investors continue to trade cautiously. Also, we anticipate increased sell pressures during the week, driven by portfolio rebalancing activities as portfolio managers reassess their positions for the closing half-year period. Thus, spurring profit-taking on selected stocks that have realised substantial gains,” Meristem research analysts said on Monday.
However, they do not anticipate a significant outflow from equities “due to the upcoming bond auction. There’s still a possibility of increased buying and bargain-hunting activity. Overall, we expect selling pressure to outweigh buying interest, dragging the All-Share Index lower this week”.
“We expect activities in the fixed income market to continue to stand as a demotivator toward a broader/deeper scale of equities investments. Investors are only entertaining opportunistic investments in fundamentally sound stocks (relatively/wholly undervalued) and stocks with recent corporate actions (particularly M&As),” said United Capital research analysts.
The observed bargain hunting is expected to remain unabated as a class of investors opt to begin preparation for a moderation in monetary policy posture in H2-2024 (particularly in Q3-2024). A strong basis for the preparation is the expected high base effect for inflation in June 2024. Overall, fund managers and investors may continue to adopt an opportunistic investment strategy, which involves trading market volatility and/or investing in undervalued equities,” United Capital analysts further said.
The FCMB-TLG Private Debt Fund focuses on investing in commercially viable and impact-oriented activities in sectors of the Nigerian economy aligned with the United Nations (UN) Sustainable Development Goals (SDG), while providing investors with an opportunity to earn competitive risk-adjusted return on investment.
Recently, FCMB Asset Management Limited (FCMBAM) held a signing ceremony for Nigeria’s first Naira denominated Private Debt Fund, the FCMB-TLG Private Debt Fund.