The Nigerian Stock Exchange (NSE) conducted an Islamic screening exercise on the fifteen companies in the NSE Lotus Islamic Index (NSE LII) and other Shari’ah compliant companies using their 2012 year-end financial statements, the result of which saw some stocks likely failing the screening exercise. The Exchange made it known to the Press that possible replacements will be made to the stocks that are due to exit the index.
The stocks that may likely fail the screening exercise and might be replaced are:
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- Japaul Oil & Maritime Service Plc
- Honeywell Flourmills Plc
- Dangote Flour Plc
The five possible replacements that have passed all Islamic screening as well as liquidity and market capitalization criteria are:
- CAP Plc
- Julius Berger Nigeria Plc
- Presco Plc
- Dangote Sugar Refinery Plc
- Redstar Express Plc
The NSE confirmed in a statement to the media that the fifteen companies that will make the NSE LII list and Market Capitalizations will be made public before the end of the month, and before the index rebasing date of July 1, 2013. All the companies that will appear in the Index have been thoroughly screened by Lotus Capital Halal Investment, in accordance with a methodology approved by an internationally-recognized Shari’ah Advisory Board comprising of renowned Islamic scholars.
It can be recalled that the Nigerian Stock Exchange and Lotus Capital Limited launched the certified Shari’ah-compliant index in July 2012, to cater for investors with a preference for ethical/Shari’ah compliant investments. The NSE LII tracks the performance of 15 Shari’ah-compliant equities which have met the eligibility requirements of a renowned Shari’ah Advisory Board. The component stocks are rigorously screened and reviewed bi-annually to ensure their continuous compliance for inclusion in the index.
The NSE LII was the first index created to track the performance of Shari’ah-compliant equities on the floor of the bourse, with the objective of increasing the breadth of the market and creating an important benchmark for investments as the alternative non-interest investment space widens.
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