About 11 years ago, the parent company of Guinness Nigeria, Diageo Plc invested over N52 billion in capacity expansion; making it the largest investment ever made by any market anywhere in the world.
According to data gathered by Afrinvest Securities Limited as of half-year 2019, the company had a total installed capacity of 5.5mhl. Guinness Nigeria adopted the total beverage alcohol (TBA) strategy, which cannibalized sales of rivals in that industry; to increase its share of the Nigerian beer market and cater to a young population that craves consumption.
The company’s capacity to readily increase the price of its flagship items and absorb rising input prices suggests favorable indicators for future earnings growth, which supports investment firms’ Buy ratings on its shares.
The annual inflation rate in Nigeria increased for a fifth consecutive month in June 2022, reaching 18. 6%, the highest level since January 2017, and down from 17. 7% in May. In a similar vein, Guinness Nigeria saw a rise in net profit margin from 0. 78 percent to 7.59 percent in June 2022.