Five Profitable Investment Sectors In Nigeria To Watch In 2023

Despite market challenges, Nigeria presents several investment opportunities in the fields of fintech, mobility, agriculture, renewable energy, and infrastructure.

Fintech is still a relatively untapped sector, with opportunities in SME financing, social commerce financing, and delivery.

Agriculture and renewable energy also have significant potential, and infrastructure development is critical for Nigeria to attract investment.

Despite several adverse market conditions such as economic volatility, high inflation, currency concerns, and political uncertainty, Nigeria still has a plethora of sectors available for investment. 

This article will look at five of these sectors: fintech, mobility, agriculture, renewable energy, and infrastructure.

1. Transportation and Delivery (Mobility)

Given Nigeria's poor infrastructure and lack of rail transportation, the mobility sector is a growing area of investment. 

Max.ng and GIG are using technology to improve social commerce deliveries and intercity transportation, while Kobo360 is the region's largest technology-driven long-haul logistics company. 

Autochek facilitates vehicle resale in Nigeria through a tech-enabled vehicle marketplace and financing options.

2. Renewable Energy

The potential for renewable energy, particularly solar energy, is enormous; firms like Daystar and StarSight are expanding in Nigeria. 

Both the residential and commercial markets are still crowded with competitors. 

Many of these players, including M-KOPA and d.Light has also expanded to mobile phones and will do so again as they round out their product lines to include solar appliances. 

The economic case for accelerating solar deployments in Nigeria is stronger than ever given that the oil price looks like it will remain on the high side. 

3. Fintech

The fintech industry in Nigeria has received the most investment, but it is still underutilized, especially in areas like SME financing, social commerce financing and delivery, and the aggregation and financing of smallholder farmer output. 

Services like insurance and higher-yielding savings accounts are hardly ever offered at scale, and mobile money has not yet been implemented. 

Core fintech still presents a sizable opportunity for a $500 billion economy. 

Along with market leaders like Flutterwave, Paystack, and Interswitch, we are now witnessing emerging growth companies like Migo, Carbon, Nomba, and PiggyVest scale to levels that inevitably draw foreign investors who are not required to invest in Africa but rather are looking for a minimum scale regardless of geography.

4. Infrastructure

Building basic infrastructure for a true Internet economy is essential for Nigeria to attract investment. 

Kasi and Rack Centre are leading the charge in building modern data centre operations in Lagos.

The infrastructure sector seems to be booming only in Lagos and the Nigerian capital, Abuja. 

However, there is a need for diversification of this sector to expand to other states in Nigeria if the sector wants to maximise its profitability. 

5. Agriculture

Nigeria's largest industry is agriculture, and well-known tech-enabled growth companies like ThriveAgric and Releaf have grown to the size required to draw foreign investment. 

Nearly 500,000 smallholder farmers have become devoted supporters of Thrive and receive better prices and services.