Dangote Petroleum Refinery and Petrochemicals FZE could be worth significantly more than its proposed valuation on the Nigerian Exchange (NGX), according to estimates from two Nigerian investment firms.
CardinalStone Research and Chapel Hill Denham have separately valued the refinery at between N77.7 trillion and N82.62 trillion. Their estimates are higher than the N65.22 trillion indicative market capitalisation attached to the company ahead of its planned Initial Public Offering (IPO). The difference has drawn attention as investors prepare for the refinery’s entry into the Nigerian capital market. Under the IPO plan, the company will offer 4.1 billion new ordinary shares at N525 each. It currently has about 120.13 billion issued shares.
If the base offer is fully taken up, the refinery is expected to have an indicative market value of N65.22 trillion when it lists on the NGX.
CardinalStone Research has placed a 12 month valuation of N77.7 trillion on the business. This translates to a target share price of N688.09 based on the share structure used in its assessment. Chapel Hill Denham has gone further, estimating the refinery’s current fair equity value at $62.53 billion, equivalent to N82.62 trillion using an exchange rate of N1,321.22 to the dollar. The investment firm also believes the company’s value could increase as its planned expansion begins to contribute to production and earnings. The two firms reached their valuations by assessing the refinery’s expected future earnings and cash flows. Their calculations also considered how similar companies in the refining industry are valued.
CardinalStone used a combination of discounted cash flow analysis, enterprise value to earnings before interest, taxes, depreciation and amortisation and price to earnings ratios. Chapel Hill Denham applied similar methods, giving half of its valuation weight to discounted cash flow and the remaining half to the other two methods. Both firms expect the refinery’s financial performance to improve considerably as production increases.
CardinalStone projects revenue of about $29.6 billion and profit after tax of $3.8 billion for 2026. Chapel Hill Denham estimates revenue at approximately $28.2 billion, with net earnings of $4.1 billion. The refinery’s recent results also support the expectation of stronger earnings. It recorded $13.91 billion in revenue and $1.82 billion in profit after tax in the first half of 2026. This represents a major turnaround from the $475.8 million loss recorded for the full year in 2025.
Expansion is another major factor behind the higher valuations. Dangote Refinery plans to increase its refining capacity from about 700,000 barrels per day to 1.4 million barrels per day. The expansion is estimated to cost $14.27 billion. Part of the funding will come from the IPO. Of the expected N2.11 trillion net proceeds, about N841 billion will go towards utilities and related infrastructure, while N686.5 billion will be used for refinery processing units and major equipment. Another N583.5 billion is earmarked for construction, installation and other expansion activities.
However, analysts warn that the higher valuations do not guarantee that the refinery’s shares will rise after listing. The company will need to maintain strong refining margins, operate at high capacity and successfully complete its expansion plans to justify the higher valuations. The refinery is scheduled to open its IPO for subscription on September 14 and close on October 13, 2026. Trading on the NGX is expected to begin in late November. The offer is expected to raise about N2.15 trillion if fully subscribed, with investors able to buy a minimum of 10 shares for N5,250.
While the proposed N525 offer price appears lower than the valuations from CardinalStone and Chapel Hill Denham, investors will ultimately determine the refinery’s market value after listing through demand, supply and market sentiment.
