Highlights:
- The CROBEX advanced 1.17%, HRK 27.8mn in total regular turnover
- Ingra announces tender for sale of Zagreb Arena
- INA announces sale of Crobenz
- Cooperation contract signed between Ingra and Tehnika on Algerian market
- T-Hrvatski Telekom to collect HRK 6.1mn in dividend from HT Mostar
market comment:
The Croatian equity market witnessed further positive movements yesterday, with domestic equities gaining for the second day. market liquidity remained on the levels seen the day before, with HRK 27.8mn in total regular turnover on the Zagreb Stock exchange and six stocks with more than HRK 1mn in traded value. Equity benchmarks CROBEX and CROBEX10 advanced 1.17% and 1.14% to 2,109 points and 1,095 points, respectively, this being their second straight gain. The eleventh straight gain of the Baltic Dry index finally spurred the Croatian shipping stocks, which were the best performers on the market yesterday. Jadroplov and Atlantska plovidba surged 6.9% and 5.8%, respectively, with the latter one being the most liquid stock. Strong performance was also seen by seaport Luka Ploce, which jumped 5.8%. Construction companies Ingra and Dalekovod performed weakly and declined 2.8% and 2.1%, respectively.
market outlook:
Positive momentum on the Croatian equity market may bring further gains today.
Corporate news:
Ingra announces tender for sale of Zagreb Arena
Ingra announced an international tender for the sale of a 100% stake in the company Laniste Ltd., which is the owner of the sport hall Zagreb Arena. Offers are to be delivered to the company within one month. According to the company, this tender is a way to gain an independent valuation of this project and tests the overall demand, although the sale is not ruled out in the case of a satisfactory offer. The Zagreb Arena project has guaranteed annual cash flows of EUR 7.2mn along with VAT paid jointly by the Croatian government and the city of Zagreb on a quarterly basis. Rent is to be paid for the following 28 years, while the city of Zagreb has the option to buy this investment after seven years for EUR 80.4mn.
According to Ingra, overall investment in the construction of this sport hall was somewhere around EUR 100mn, hence this project is one of the key generators of the company’s illiquidity. The sale of Laniste Ltd. would most likely be seen as a positive thing, as it would free cash for some other projects and significantly reduce leverage and risk present in the company.
Furthermore, interest costs would be moderated, which would be positive for the bottom line in the following years. However, in the case of a discount sale, the write-down of receivables would hurt the bottom line the year of the sale.
INA announces sale of Crobenz
INA announced in the Croatian press and on its web page a tender for the sale of the retail Business of company Crobenz. This sale is required by the Croatian Competition Agency in order to give a green light to INA’s acquisition by MOL. The deadline for this sale is nine months from the point in June when the Agency approved the merger. Details on Crobenz will be available to potential buyers upon signing a confidentiality agreement. A letter of intent should be delivered to INA by November 20. The Croatian press speculates that interest in the retail network of 14 gas stations will be shown by Lukoil, OMV, Petrol, Eni and Hellenic Petroleum. An optimistic scenario from analysts foresees INA collecting around EUR 50mn from this sale. The three main criteria for participating in this tender are expertise in maintenance of the Business, no capital or personal connections with INA and a satisfactory level of funds. Separately, after the Croatian government published its shareholders agreement with MOL, the press speculated that MOL has opened hands to swap its holding in INA for Russian Surgut’s stake in MOL. However, MOL’s CEO Mr. Zsolt Hernadi denied such speculations and said that MOL’s management board has no such plans.
Cooperation contract signed between Ingra and Tehnika on Algerian market
Ingra announced on the Zagreb Stock exchange a Business cooperation contract signed with Tehnika for the Algerian market. The deal clarifies the details of the joint approach in attracting new construction and maintenance deals on this overseas market. The contract was signed for a five-year period and considers all deals within this period along with supporting continuing deals on already conducted work within the five-year period. Furthermore, the company spoke about pending contracts worth EUR 50mn on the Algerian market, as well as active tenders worth EUR 380mn in which the company is competing.
T-Hrvatski Telekom to collect HRK 6.1mn in dividend from HT Mostar
The AGM of B&H Telecom HT Mostar approved an HRK 15.6mn dividend out of FY08 net profit of around HRK 15.9mn. The major part of this dividend will be allocated to the Bosnian government, which holds a 50.1% stake in the company, while THrvatski Telekom should get around HRK 6.1mn (39.1% stake).
INA: hydrocracker unit in Rijeka refinery will be finalized by May
Vice president of refining of MOL, Mr. Bela Kelemen said that hydrocracker unit in Rijeka refinery of INA will be finalized by May and the operation might starts at the mid of 2010. The sulfur recovery plant at Sisak is expected to be operational after the middle of next year, while isomerization unit for making gasoline components, is also being built on site. These are inline with the original schedule as we can see. So it should have no effect on share prices. Jozsef Miro (+36 1) 235 5131
Institut IGH denies write off of receivables towards Government owned companies
Engineering company Institut IGH waived press announcements that company is writing off receivables it has towards Government owned companies. On the contrary, considering deteriorating environment, company strives to even decrease deadlines for collection of receivables, said by the company. All matured receivables are tried to be collected within reasonable deadlines, however only if this fails then IGH will consider taking some legal actions.
CROBEX (chart, table)
Top 10 Turnovers (table)
Top 5 Winners (table)
Top 5 Losers (table)
Croatian Equity Daily (table)
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Copyright: Erste Securities Zagreb, sales : Zeljka Kajkut-Brni Phone: +385 62 37 2811 kajkutz@erstebank.com Damir Eror Phone: +385 62 37 2813 erord@erstebank.com Research: Damir Cukman Phone: +385 62 37 2820 cukmand@erstebank.com Davor Spoljar Phone: +385 62 37 2825 dspoljar@erstebank.com
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