Why Jumia shunned the Nigerian Stock Exchange
Why Jumia listed overseas. Source: Stears Business

In the first quarter of 2019, Jumia, the darling of African e-commerce, went public on the New York Stock Exchange (NYSE). At the time, faint murmurs questioned why the company shunned the Nigerian Stock Exchange (NSE), the second-largest bourse on the continent.

A few weeks ago, Jumia released its financial results for the second quarter of 2020, revealing its best performance since the listing as operating losses fell from €66 million to €37 million year-on-year. Even before interest and tax payments, Jumia is still making substantial losses.

As Jumia reported another loss, those murmurs could be given a straightforward reply: how would a loss-making business like Jumia be received on the NSE?  

 

Valuing a company is more art than science

There is no single definition of a successful Initial Public Offering (IPO). In this case, we define a successful listing to be when the stock is actively traded (liquid) after listing, and, assuming no major market shocks, the

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Ebitonye Atte

Ebitonye Atte

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