Why the Share Price of Cement Producing Companies Would Soar Like a Bird - Opinion

If you are a fan of the series Billions (currently in its 7th season), you would understand the context of this post. It's safe to say a big shout-out to the only other Billions fan I know, Michael Ekanem.CDGN . Hey, even if you are not a fan or have not seen the series, there is still something to learn.

So what's the connection between an American series with the Nigeria Stock Exchange and the alleged increase in the share price of cement-producing companies in Nigeria?

Before I tell you about the connection, I would like to reference some scenes from Billions Season 2 Episode 5 with the title "Nigeria Currency Scam," according to the Refinery29 recap😂😂😂. Stay with me; from that title alone, you can see that the series had a stint on our Naira devaluation.

Let me backtrack to mention that Bloomberg reported on the 12th of January 2017 that "Nigeria Central Bank Won't Devalue Naira, Traders' Union Says," and the episode aired on the 19th of March 2017. Could that have been some foreign pressure to devalue the Naira - well, that is not my focus for this discussion.

Let's see an excerpt of the recap Refinery29 made on that episode to get a clear picture.

When Axe takes a meeting with Everett over lobster, Everett tells him Nigeria will devalue their currency soon, and a massive short against it could help make that happen sooner rather than later.

My main point is that in the world of finance and investing, perception matters a lot. Deals are etched on the back of new information and counter information. The people controlling the information can sometimes make a lot of money, which is why we have insider trading restrictions and laws. In a sense, to protect the market and the little guys from the fight of "billionaire elephants".

Let me jump to the apparent reason you have read this far. To know the correlation or speculation that would drive the share price of cement-producing company.

I bet you know Senator David Umahi is now the new Minister of Works. He recently went on a tour of ongoing construction on Federal road project's. So you can imagine the spark I got in my brain when Tribune Newspaper reported that

"The minister said that many roads would be redesigned for concrete pavement, which can last up to 50 years and provide Nigerian road users with the experience of asphalt pavement."

Again, they quoted him as saying

"He stated that in pursuit of value for money, the remaining portion of the road would be designed for concrete pavement, which he said was cheaper for the country and would last longer."

Finally, they ended the reporting by saying

"He called on all contractors, especially the big construction companies, to embrace concrete pavement for the construction of Nigerian roads as he argued that the technology offers the nation durability of the streets for use."

Please can you see the handwriting on the cement? In my speculation, if all federal road projects would deploy concrete pavement whose primary raw material is cement. Then, ordinarily, the demand for cement by all federal contractors would increase right? With such a high demand for cement, cement producing companies would need to ramp up production and this would definitely create a positive outlook for cement manufacturing companies and drive revenue growth.

That's more dividends for investors, but what do I know? The silver lining is that cement and steel rod distributors who are "rightly" positioned would also benefit from the increased demands.

Finally, I am want to declare that all the time spent watching Billions was not wasted. However, do note that the opinions expressed here do not constitute financial advice.