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Below is a detailed overview of the financial performance of MTN Nigeria Communications Plc during the first quarter of 2024.

Limited Pass-through for Stronger Revenues

In its recently released Q1:2024 financial result, MTN Nigeria Communications Plc (MTNN) recorded higher revenue figures on a Year- on-Year (YoY) basis, recording a 32.54% YoY growth to NGN752.98bn in Q1:2024. Topline growth was supported by a strong growth in Data Revenue (+53.34% YoY to NGN349.00bn), followed by an increase in Other Revenue (+28.70% YoY to NG136.47bn) which consists of ancillary income streams such as rental income, digital revenue, etc. Voice revenue rose at a relatively faster rate by 14.08% YoY to NGN267.51bn in Q1:2024 (vs. +8.30% YoY in Q1:2023). The uptrend in Revenue growth was offset by higher total operating expenses which went up by 65.49% YoY to NGN454.23bn in Q1:2024.

Data Revenue Continues Bullish Run

In Q1:2024, Data Revenue continued its growth trajectory, contributing to 46.35% of total Revenue. Following closely was Voice Revenue (35.53%) and Other Revenue (18.12%).

After considering the factors outlined, we posit a bullish stance on MTN Nigeria Communications Plc. and revise our recommendation to a “STRONG BUY”, with an updated target price of NGN270.16 (22.80% upside potential as of May 14th, 2024).

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