Norrenberger’s Equity Portfolio Model (EPM) once again outperformed the Nigerian equity market in 2025, delivering an impressive 82 per cent return and beating key market benchmarks for the second consecutive year.
The strong performance significantly exceeded the returns of major indices on the Nigerian Exchange (NGX), with the NGX All-Share Index (ASI) gaining 52 per cent and the NGX 30 Index rising by 50 per cent over the same period.
This translates to an outperformance margin of about 30 percentage points against the ASI and 33 percentage points over the NGX 30, underscoring the strength of Norrenberger’s investment strategy and disciplined portfolio construction.
The 2025 outcome builds on the model’s solid showing in 2024, when the EPM returned 48.1 per cent, outperforming the NGX ASI’s 38 per cent gain.
The back-to-back outperformance highlights the consistency of the model across different market conditions and reinforces its effectiveness in generating superior risk-adjusted returns.
Norrenberger said the EPM was designed to consistently outperform the broader market through a combination of rigorous macroeconomic analysis, sector allocation, stock selection and active risk management.
In 2025, the portfolio comprised ten carefully selected stocks spanning key sectors of the Nigerian economy, including telecommunications, consumer goods, banking, energy and insurance.
Sector selection for the year was guided by Norrenberger’s macroeconomic outlook, particularly expectations of earnings recovery in sectors such as consumer goods and telecommunications following FX-induced losses triggered by the naira devaluation. This thematic positioning enabled the portfolio to capture cyclical recovery opportunities while maintaining exposure to long-term structural growth trends.
At the stock level, selection combined strong earnings fundamentals with technical analysis, allowing the portfolio to benefit from both improving company performance and favourable market momentum. The approach also ensured a disciplined balance between growth-oriented and defensive positions.
MTN Nigeria (MTNN), the portfolio’s largest holding with a 15 per cent weight, emerged as the biggest driver of performance. The stock delivered an exceptional 156 per cent return in 2025, as the company rebounded strongly, enabling the portfolio to fully capture the upside from its recovery.
Other major contributors included Dangote Sugar and BUA Cement, each weighted at 11 per cent. Both companies benefited from pricing power and improving operating leverage, reinforcing the portfolio’s exposure to real-sector growth amid a gradually stabilising macroeconomic environment.
Within the banking sector, Zenith Bank and Stanbic IBTC posted gains of 36 per cent and 74 per cent, respectively. These stocks were supported by resilient earnings, strong balance sheets and solid market positioning. Their inclusion provided relative stability during periods of market volatility while still participating in the broader equity rally.
Mid-sized and smaller positions further enhanced diversification and returns. Aradel Holdings recorded a modest 12 per cent gain, offering measured exposure to the oil and gas sector. Transcorp Power, however, declined by 15 per cent during the year, reflecting subdued performance, though it played a diversification role within the portfolio.
Among the smaller holdings, AXA Mansard returned 67 per cent, Jaiz Bank gained 52 per cent, while NASCON Allied Industries delivered an exceptional 243 per cent return. These performances were driven by a combination of sector-specific tailwinds, improved company fundamentals and positive investor sentiment.
Overall, Norrenberger said the EPM’s 2025 performance reflects a well-balanced portfolio that successfully combined high-growth opportunities with defensive and income-generating positions, allowing it to outperform the market despite varying conditions across sectors.
Looking ahead to 2026, Norrenberger disclosed that the Equity Portfolio Model has been restructured into four distinct portfolios to offer clients a broader range of options aligned with different risk appetites and investment objectives.
A key addition is a soon-to-be-launched Sustainability Index, which will track NGX-listed companies with strong environmental, social and governance (ESG) credentials.
On the outlook for 2026, Norrenberger noted that after several years of strong market performance, equity returns are expected to become more selective and earnings-driven rather than broad-based. Companies with strong balance sheets, pricing power and exposure to long-term structural growth themes are likely to outperform.
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