market WRAP-UP
The market slightly recoveredlast week as SOFIX added 5.2% to 1 246.97 bps while BG40 advanced by 4.6% to 354.32 bps. Released 2007 audited unconsolidated reports pushed some of the stocks prices up but buying enthusiasm came mainly from positive news from Europe and USA. It is important to note that the liquidity remained low and we believe the market is still mainly driven by small retail investors. Now we will keep an eye on the forthcoming Q1- 2008 financial results which are to be released till the end of April as we strongly believe that despite the overall negative situation on world capital markets positive financial reports will support BSE-Sofia.
SOFIX (one month) (chart)
BG40 (one month) (chart)
| SOFIX | BG40 | |
| 1-wk change | 5.2% | 4.6% |
| 1-m change | -12.4% | -12.8% |
| 3-m change | -29.5% | -31.6% |
| 6-m change | -32.2% | -32.6% |
| Year-to-date | -28.2% | -31.4% |
| 12-m change | -1.3% | 40.3% |
| Period | Week 13 |
| Weekly volume (No of securities) | 13 497 618 |
| Weekly turnover (BGN) | 59 667 468 |
| Average weekly turnover YTD (BGN) | 73 260 695 |
Top Gainers*
| Sparky Eltos [ELTOS] | 21.4% |
| Alcomet [ALUM] | 16.7% |
| Kapitan Diado Nikola [KDN] | 16.5% |
Top Losers *
| Holding Roads [HDPAT] | -2.7% |
| Biovet [BIOV] | -2.2% |
| Bulgartabac Holding [BTH] | -0.4% |
* from our list of selected stocks. Changes based on avg. prices. For companies included, see table on p.3
news HIGHLIGHTS
- Net external debt for Jan 2008 was €11.4bn, 34.8% of GDP and up 3.5% MoM.
- Bulgarian GDP per capita was €3 800 in 2007, 6x lower than the EU average.
- Natural gas price will be hiked 13.25% to €211 per 1,000 m3 (VAT excluded).
- BTC [BTC] announced a €56.2 investment plan focused on mobile and ADSL.
- Doverie Obedinen Holding [DOVUHL] acquired for an undisclosed amount a 90% stake in Medico 21, the third largest health insurance fund.
- Lukoil and Hellenic Petroleum Groupshowed interest in acquiring gas stations from Petrol [PET] and Tempo Petrol.
- Drujba Glassworks [DRUPL] approved a stock dividend raising the capital from BGN 6.7m to BGN 53.5m.
- Fairplay Properties [FPP] will distribute €4.1 cash dividend for 2007.
- REIT Black Sea investments [BSEA] capital raise prospectus was approved. The company issues 14.3m shares at par and issue value of €0.51.
- Bioiasis, a medical products distributor, prospectus was approved.
- Mel Invest [ALOFMI] rights for the capital increase will trade Mar 27-Apr 9.
AUDITED FY 07 FINANCIAL RESULTS
Odessos Shiprepair Yard [ODES]
Tax expenses included, no surprises
The audited FY 2007 financial results of Odessos Shiprepair Yard [ODES] showed sales of BGN 41.6m (up 16.5% YoY) and a net profit of BGN 7.9m (up 21% YoY). Corporate tax expenses were omitted in the preliminary results and the auditors’ correction led to a decrease of the net profit from BGN 8.9m to BGN 8m. Source: FFBH
Monbat [MONBAT]
Feb sales at BGN 20m, stock and cash dividends
Monbat booked revenues of BGN 20m in Feb 08, up 135% YoY. Net income for Feb 08 reached BGN 3.5m while YTD it stood at BGN 7.4m, up 235% YoY. The company plans both a stock dividend (raising the capital from BGN 19.5m to BGN 39m) and a cash dividend of 20% of FY 07 profit of BGN 17.4m. Source: Profit.bg
INVESTMENT PLANS AND FORECASTS
Enemona [ENM]
Three investment projects worth BGN 143m
Enemona will invest c.BGN 100m in the construction of a 50MW cogeneration plan fuelled by agricultural waste. Additionally the company will invest BGN 43m for a pellet factory, a heating plant, a logistics centre and a Business park, all in the municipality of Lom. Source: Pari
Sopharma [SFARM]
Sopharma to invest €8m in Serbian plant
Sopharma will invest €8m in a new pharmaceutical facility in Serbia, the BSE announced. The facility is planned to start operating by 2009. Furthermore, SFARM has purchased 90% of the shares of Belgrade-based drug maker Ivancic&Sons, which manufactures 21 products. Source: Pari
Elhim Iskra [ELHIM]
Elhim Iskra forecasts net profit of BGN 2.5m for 2008
In 2008 ELHIM projects to book net profit of BGN 2.5m, revenues of BGN 43.3m (23% higher compared to 2007), and to make investments of BGN 1.9m (financed with own funds). Source: Investor.bg, FFBH
news IN THE SPOTLIGHT
Financial news
Major banks start raising loan rates
Major banks in Bulgaria have started raising their interest rates for existing and new loans. UBB raised the retail rates (consumer and mortgage) by 50bp and Eurobank by 25bp. As a comparison, Euribor 3mo added 80bp YoY to the current 4.731%. Source: Dnevnik, FFBH
Kremikovtzi [KREM]
Lakshmi Mittal ready to pay the bond nominal value
Indian billionaire Lakshmi Mittal is the only candidate buyer for Kremikovtzi who is ready to settle in full with the holders of KREM collaterised bonds. The nominal value of the paper is €325m but payment in full should total 101% or €328.25m in case of an ownership changeover. Source: Dnevnik
FIXED INCOME AND MACRO DATA
NB: quotes are only indicative
| Type | Coupon | Maturity | Currency | Yield (%) | Spread Over Treasuries (bps) | Bid (% of par) | Offer (% of par) |
| Eurobonds | 7.50% | Jan-13 | EUR | NA | NA | NA | NA |
| Eurobonds | 8.25% | Jan-15 | USD | 5.15 | 212 | 117.25 | 118.00 |
Most recent macro data
| BGN/EUR exchange rate | 1.95583 |
| Inflation (MoM February) | 1.1% |
| Inflation (cumulative 2008) | 2.5% |
| Base interest rate | 4.83% |
| LEONIA reference rate | 4.87% |
| GDP Growth (Y/Y 2007) | 6.2% |
| Unemployment (Feb 2008) | 7.26% |
| Public External Debt/GDP (Jan '08) | 12.4% |
| Foreign Direct Investment Jan '08 (EUR) | 242m |
SOFIBOR for Fri, 28 Mar
| Maturity | Rate |
| Overnight (ON) | 4.99 |
| One week (SW) | 5.34 |
| 1-month | 6.40 |
| 3-month | 6.73 |
| 12-month | 7.63 |
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Copyright: 2006 First Financial Brokerage House. All rights reserved.For further Information please contact FFBH, 2 Enos Str., 1408 Sofia, BulgariaPhone: +359 2 810 64 21, fax: +359 2 810 64 01, e-mail: ffbh@ffbh.bg, web site: http://www.ffbh.bg
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