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LequteMan
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Nigeria- Tough times await Nigerian consumers following the instability of the Naira, despite several interventions by the Central Bank of Nigeria, Financial research firm, Renaissance Capital predicts.
According to Ventures Africa, the firm sees no respite for the naira in the short term and expects further naira depreciation to NGN220/$1 over the year.
“We have cut our FY15E earnings forecasts and TPs across the group. We downgrade Nestle Foods Nigeria to HOLD (from Buy) on revisions to our forecasts. GlaxoSmithKline Consumer Nigeria (GSK) is our only BUY, while Unilever Nigeria and Cadbury Nigeria remain SELLs,” RenCap said in its Full year 2015 forecast.
It estimates that Unilever will decline by 44% in 2015, GSK by 30%, Cadbury by 16% and Nestle by 12%.
RenCap says it expects that the further naira depreciation over 2015 will have “a material impact” on the price of imported goods our input with lower global food prices no longer offsetting naira depreciation.
RenCap noted that despite the impact of increased inflation, and a 30 percent on average weaker Naira on finished goods, it does not think companies will be able to fully pass on the increased input costs in price increases.
It also sees little chance of the government increasing wages an employment growth because of the continuing constrained consumer environment.
#Nigeria
According to Ventures Africa, the firm sees no respite for the naira in the short term and expects further naira depreciation to NGN220/$1 over the year.
“We have cut our FY15E earnings forecasts and TPs across the group. We downgrade Nestle Foods Nigeria to HOLD (from Buy) on revisions to our forecasts. GlaxoSmithKline Consumer Nigeria (GSK) is our only BUY, while Unilever Nigeria and Cadbury Nigeria remain SELLs,” RenCap said in its Full year 2015 forecast.
It estimates that Unilever will decline by 44% in 2015, GSK by 30%, Cadbury by 16% and Nestle by 12%.
RenCap says it expects that the further naira depreciation over 2015 will have “a material impact” on the price of imported goods our input with lower global food prices no longer offsetting naira depreciation.
RenCap noted that despite the impact of increased inflation, and a 30 percent on average weaker Naira on finished goods, it does not think companies will be able to fully pass on the increased input costs in price increases.
It also sees little chance of the government increasing wages an employment growth because of the continuing constrained consumer environment.
#Nigeria
