An investor who staked N1 million on the shares of Nigerian Aviation Handling Company (NAHCO) Plc 12 years ago has seen his investment rise to N21.5 million due to sustained capital appreciation.
The current shareholdings value excludes cash dividends received over the years.
Stock market analysis for the period between August 20, 2013, and August 20, 2025, showed that an investment of N1 million in NAHCO in 2013 now has a total share value of N21.5 million, representing a cumulative return of 2,048 per cent over the 12-year period and an average annual return of 170.64 per cent.
The total share value of N21.5 million included two bonus issues undertaken by the company during the period, but excluded cash dividends paid by the company, noted for consistent cash dividend payment.
With N1 million, total shareholdings stood at 158,730 shares at the beginning of the prototype portfolio and closed the period with about 209,524 shares. NAHCO had declared bonus shares of one share for every 10 shares held in 2015 and followed this with a bonus of one share for every five shares held in 2022.
Bonus issue or scrip dividend represents shares that are distributed free to shareholders in the proportion of their shareholdings as at the qualification date. Such bonus shares are paid for from the reserves of the company, typically accumulated retained earnings. As such, bonus issuance illustrates the earnings capacity and profitability of a company.
NAHCO, which was privatised in 2005 and currently has more than 72,000 shareholders, has emerged at the top of the best-performing stock at the Nigerian stock market with more than six times return higher the average annual return at the market.
The leading aviation handling group is headlining the stock market as the indicative stock for the wealth-creating potential of the Nigerian stock market after recording a cumulative capital gain of 2,048 per cent over a 12-year period, as against 287.23 per cent recorded by the benchmark index for the market.
NAHCO recorded an average annual capital gain of 170.64 per cent over a 12-year period, compared with 23.94 per cent recorded by the overall benchmark index for the stock market.
While the overall, double-digit, positive return by the market underlines the value retention of quoted equities over the years, NAHCO’s excellent performance marks it out as an inflation-hedging stock for long-term investments.
This implies that an average investor in NAHCO still has an annual return of more than 100 per cent over the 12-year period, when adjusted for the inflation rate and the cost of capital or interest rate.
Trading analysis showed that on a straight line, NAHCO’s share price appreciated by 1,527 per cent over the 12-year period, representing an average annual capital gain of 127.2 per cent.
Read also: NAHCO records 166.7 net profit growth in first half of 2025
When two bonus issues undertaken during the period were considered, the total value of the shareholdings increased by 2,048 per cent, indicating an average annual gain of 170.64 per cent.
The analysis showed that NAHCO’s share price rose from N6.30 on August 20, 2013, to N102.50 per share on August 20, 2025, a cumulative increase of 1,527 per cent or average annual growth of 127.2 per cent.
On the other hand, the All Share Index (ASI)- the benchmark index that tracks all share prices at the Nigerian Exchange (NGX) rose from 36,558.50 points on August 20, 2013, to close on August 20, 2025, at 141,566.31 points. This represented a cumulative 12-year gain of 287.23 per cent or an average annual gain of 23.94 per cent.
Market analysts said stocks like NAHCO underscore the wealth-creating and distributing capacity of the stock market, building up significant gains for investors over a period of time.
They pointed out that the success of NAHCO pointed to the indirect wealth distribution of the government’s privatisation programme.
Analysts attributed NAHCO’s capital gain to the continuing growth in its operations and improvements in the management of the company.
Kehinde Hassan, managing director, GTI Capital Limited, described the linkage between fundamentals and share pricing trends like the relationship between a building’s foundation and the strength and height of the building.
He noted that while the stock market may be influenced temporarily by emotions, speculations and immediate macroeconomic development, solid fundamentals remain the ultimate support base that ensures that a company retains value over the years.
“Fundamentals refer to the core financial health and performance of a company. These include earnings per share (EPS), revenue growth depicting sales trajectory over time, profit margins, and return on equity (ROE), which reflects how well the company uses shareholders’ funds and dividend payouts indicating cash returned to shareholders. These metrics help investors estimate a company’s intrinsic value,” Hassan, a chartered accountant and multi-asset stockbroker, said. David Adonri, managing director, HighCap Securities, said the performance of NAHCO underlined its strong fundamentals.
According to him, the capital market is information-driven as all the information available about an issuer or a company, as well as macroeconomic fundamentals and sociopolitical environment, now and into the foreseeable future, is priced into the value of securities.
“The combination of all forces above shapes the fundamentals of a company and dictates the direction of price movement of the stock through the market mechanism of supply and demand.
“A stock like NAHCO has appreciated heavily over the years because of its strong fundamentals, high dividend yield, and consistent dividend payout. Over time, there is a correlation between a company’s fundamentals and growth in its market value,” Adonri, a senior investment banker, said.
In the first half of 2025, NAHCO rode on the back of a double in revenue and improved operating efficiency to leapfrog its net profit by 166.7 per cent to N8.88 billion.
