Bucharest Stock Exchange evolution in the first half of 2018 beat the inflation with a growth of 11 percent

Aurel Dragan 11/07/2018 | 06:00

The first half of the year brought two listings to Bucharest Stock Exchange (BVB), a technical one and an IPO (initial public offering). And BET-TR (BET total return) index, that includes in performance the dividends paid by the companies from 2017 profit, ended the period up 11 percent from the end of 2017.

“The first half ended with international recognition as the global index provider MSCI upgraded the accessibility criteria for Romania, proving the projects regarding the capital market are on the right track”, said Adrian Tanase, CEO of BVB.

Average daily value of equities trading on BVB’s regulated spot market was RON 45.44 million in the first half of the year, up 3.34 percent from the first semester of the last year. The market cap on regulated market at the end of June 2018 was RON 166.98 billion (EUR 35.82 billion).

BET index, the main index of the market, following the evolution of the most important listed companies, went up 4.3 percent in the first semester, while BET-FI, the index following the financial investment companies (SIF) and Fondul Proprietatea, went down 4.94 percent. The evolution of the indexes shows that those who took advantage of the dividends paid by the listed companies are the biggest winners of 2018 so far.

Shares of Elvila, symbol ELV, a furniture producer in Romania, started trading on the Alternative Trading System of Bucharest Stock Exchange (BVB) in the AeRO Premium category as of February 1, 2018, following a technical listing. Technical listing is the process by which a company shares start trading on a stock exchange without the need for any prior public offer, which means that the company’s shareholding structure is not affected in any way, and the firm decides to take advantage of being a public company, such as additional visibility, credibility or transparency.

Shares of Purcari Wineries (WINE), a leading CEE wine producer, started trading on February 15th on the Main Market of Bucharest Stock Exchange (BVB), following a successful IPO for 49 percent of its shares, valuing the offering at over RON 186 million (EUR 40 million).

Towards the end of April, new municipal bonds worth RON 555 million issued by Bucharest Municipality started trading on the Regulated Market of BVB. Overall, four municipal bonds issues of Bucharest Municipality have been traded on the Bucharest Stock Exchange since 2015. Mid-May, corporate bonds of EUR 550 million issued by Globalworth, one of the leading real estate investment companies in Central and Eastern Europe, started trading on the Main Market.

The corporate bonds of Globalworth are traded in euros on BVB, and the settlement is done directly in the European currency. For the first time in Romania, as of last year, Bucharest Stock Exchange implemented the settlement directly in euros, thus enhancing the degree of maturity and development of the local capital market.

In May and June, the Bucharest-based stock exchange witnessed several readjustments trading sessions as a consequence of ex-dividend corrections for several companies from the main index BET, coupled with domestic and international uncertainties, according to analysts.

When the first six months concluded, the Romanian capital market managed to retain a Top 5 position among the main indices of the stock exchanges from the European Union, considering a 4.3 percent growth rate for BET index.

“The investors who bought shares in the main companies listed on BVB could benefit, even under complex market situations, from the two-digit growth of BET-TR – an index which is representative of our capital market due to its consistent dividends – as it closed the first six months of the year by a growth rate of 11 percent, one of the highest yields in the European Union,” said Lucian Anghel, president of the Board of Governors of BVB.

The performance of the local market was enhanced by the development in several areas meant to improve investors’ experience, which was recognized internationally by one of the most important investment research firms.

“All figures asides, the first half ended with international recognition as the global index provider MSCI upgraded the accessibility criteria for Romania for three aspects: namely market regulation, information flow, and trading, proving the projects regarding the capital market are on the right track and that investors’ perception towards the local market has improved,” said Adrian Tanase, CEO of BVB.

The stock market capitalization of Romanian companies exceeded EUR 20 billion at the end of the first six months

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