Five low-cap stocks listed on the Nigerian Exchange Limited (NGX) have delivered eye-catching gains of more than 200 per cent so far in 2026, putting small-cap shares firmly in the spotlight as retail investors search for higher returns. The rally has been driven by renewed market confidence, increased retail participation and growing interest in stocks trading at relatively low prices.
SCOA Nigeria Plc emerged as one of the biggest winners, climbing from N7.10 at the start of the year to N33.05 by August 11, representing a 365.49 per cent gain. R.T. Briscoe (Nigeria) Plc also jumped 260 per cent from N3.50 to N12.60, while Union Dicon Salt Plc rose 244.20 per cent from N6.90 to N23.75. Berger Paints Nigeria Plc gained 207.50 per cent, moving from N48 to N147.60. Fortis Global Insurance Plc recorded an even larger percentage increase, rising from 20 kobo to N2.60, although investors have been advised to interpret the figure carefully because the company completed a four-for-one share reconstruction in July.
The surge comes as the wider NGX market continues to post strong returns, with the All-Share Index gaining more than 57 per cent this year. Market operators said aggressive retail buying, limited free floats and momentum trading have helped push some low-priced stocks sharply higher. Because fewer shares are available for public trading in some of these companies, relatively small increases in demand can translate into significant price movements.
Strong corporate performance has also helped attract investors to some of the companies. Berger Paints, for instance, recorded about 20 per cent revenue growth to N12.99 billion in 2025, while profit after tax increased to N1.57 billion from N610.9 million. SCOA Nigeria reported a pre-tax profit of N723.8 million in its unaudited 2025 results, compared with N27.1 million a year earlier, while R.T. Briscoe’s revenue climbed 41.1 per cent to about N40.41 billion, with profit after tax rising to N2.89 billion. The company’s first-quarter 2026 profit after tax also jumped 264 per cent year-on-year to N718.7 million.
Despite the impressive numbers, analysts are urging investors not to mistake a rapidly rising share price for a guaranteed bargain. They stressed the importance of looking beyond momentum and assessing earnings growth, revenue, balance-sheet strength, valuation and the sustainability of a company’s performance. With some of these stocks already recording extraordinary gains, profit-taking could emerge if earnings fail to grow quickly enough to support their higher valuations. For retail investors, the message is clear: the NGX low-cap rally may offer opportunities, but chasing a stock simply because its price is rising can come with significant risk.
soure: The Guardian
