After operating for three months, the NASD OTC Plc, which is operating the over-the-counter (OTC) market for the trading of securities not listed on the Nigerian Stock Exchange (NSE) is intensifying efforts to attract more patronage from investors and companies.
Launched in July 1, 2013, the NASD OTC began operations with four companies and 45 stockbroking firms but has so attracted eight companies.
They are: Friesland Campina WAMCO Nigeria Plc, Niger Delta Exploration & Production Plc, Industrial and General Insurance Plc and Food Concepts Plc. Geofluids Plc, Consolidated Breweries Plc, SWAP Technology & Telecoms Plc and BGL Plc.
Although NASD OTC has brought liquidity and transparency to the OTC market, many investors are yet to take advantage of the benefits.
Unlike before when investors of unlisted companies do not know the price or where to sell their shares, NASD OTC has created the platform. However, many investors are yet to take advantage of this market apparently due to low level of awareness and poor understanding of the OTC market.
However, THISDAY checks revealed that in order to attract more patronage, the management of NASD OTC has decided to reach out to institutional and individual investors as well as public limited liabilities firms that are not listed on the NSE to access the OTC market.
“From every indication, both companies and individuals are relatively ignorant of the numerous benefits they can derive from the NASD OTC. But the management and board of the company have decided to bring investors together and educate them on some of the things they do not know about the OTC market. It will be a meeting where several questions possibly agitating the minds of investors and companies owners, will be answered,” a market source told THISDAY last Monday.
According to source, the meeting of the investors and NASD OTC would be held very soon.
The source added the first meeting would be held in Lagos with possible arrangement to go round the country.
“Many investors are still holding the shares they bought in private placements during the capital market boom in 2007. But they do not know that such shares can be sold through the NASD OTC platform. This is one of the issues that will be discussed at the meeting with the investors,” the source also said.
Reviewing the operations of the NASD OTC recently, its Chief Executive Officer, Mr. Bola Ajomale, said since the platform became operational it had been able to create liquidity for investors of some companies not listed on the NSE.
He had noted that investors of such companies were free to trade their shares via all the broking firms listed to trade on the platform.
“So far so good; the market is gradually finding its feet. We have created the opportunity for investors to see each other and it is now left for them to sell and have some liquidity unlike before when there was no platform that provides transparency and safety for them to trade their unlisted shares,” he said.