Nascon Allied Industries Plc (“the Group”) delivered exceptional performance in FY 2023, despite the harsh macroeconomic challenges confronting the business landscape. On the back of higher pricing across all products, and volume increase in the salt segment as reported by the management during the year, revenue surged to N80.23 billion, a 37% growth from N56.79 billion in 2022.

Surprisingly, despite the official harmonisation of the exchange rate in 2023, which resulted in the Naira depreciating both in the NAFEM and parallel market, the Group recorded zero FX loss.

In stark contrast to what was achieved in FY 2023, the Group began the 2024 fiscal year with a decline in its net profit, as FX losses, and higher input costs took center stage in Q1 2024.

On the back of volume growth and strategic pricing, revenue improved by 40% to N23.62 billion (Q1 2023: N16.90 billion), while cost of goods grew by 25% to N12.46 billion (Q1 2023: N9.45 billion), bolstered by impact of inflation on input costs, as well as higher volume sales.


Considering the Group’s improved profitability reported in 2023, and the expectation of sustainability, we slightly revise our fair value N37.23 (previous: N37.02). Our previous recommendation was SELL, due to the exponential rise of the stock above our then fair value following the announcement of the proposed merger. However, after the suspension of the proposed merger, the stock price has declined significantly, as investors reacted negatively to the news. At the current price of N33.70, our fair value of N37.23 offers a total return of 16%, inclusive of a 5% dividend yield.

Please follow the link “NASCON FY 2023 & Q1 2024 -Solid Fundamentals Drive Optimism” to view the whole report.

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