The stock prices of the Dangote Group, including Dangote Sugar Refinery and NASCON Allied Industries, have recently fallen due to foreign exchange losses and the Securities and Exchange Commission’s decision to reject a proposed merger.
The ongoing inflation and volatility in the forex market have compounded these challenges, with the depreciation of the naira increasing the cost of imported raw materials and squeezing profit margins. From May to August 2024, Dangote Sugar Refinery’s stock dropped by 18.67%, while NASCON’s stock decreased by 12.57%. In contrast, Dangote Cement saw a 41% rise in its share price during the same period.
The merger, which involved Dangote Sugar Refinery, NASCON, and Dangote Rice Limited, was suspended following concerns from the Securities and Exchange Commission regarding Dangote Rice Limited’s non-operational status. Despite these setbacks, Dangote Group is actively exploring growth opportunities, with analysts attributing the stock fluctuations to broader market challenges rather than individual company performance.
Financial experts highlight the impact of forex losses and regulatory decisions on investor confidence, while industry leaders urge swift action to resolve ongoing challenges to maintain Nigeria’s appeal to foreign investors.
