Commentary
Bloody week on the BSE
The investors in Bulgarian stocks suffered one of the most nightmarish weeks since the establishment of the BSE. As a result of the massive sell-offs that started on Monday the narrow index SOFIX lost the record 11.8 % of its value, reaching a 15 months bottom or 1 185.50 points. The index completely erased the impressive growth of 60 % realized in the period of a strong rally that lasted from the end of 2006 to the middle of October 2007. At moments the market participants’ behavior verged on panic, which was evident with the deals concluded with some of the most liquid companies on the stock exchange at prices 20 or more per cent lower than the close prices from the previous Friday (March, 14). As a result 37 out of 40 members of the broad index BG 40 registered a considerable drop for the week. The ones that suffered most from the intensive sell-offs were the ‘blue-chips’ including First Investment Bank AD [FIB], whose market cap. fell by 18.6 % for the last five sessions, Chimimport AD – down by 18.1 %, Doverie United Holding AD [DOVUHL] – 17.7 % and Central Cooperative Bank AD [CCB] – 17.4 %.
Despite the fact that at the new price levelsreached in the past few days quite a large part of the companies look attractive for buying, taking into account their strong fundamentals, the sentiment remains very negative. The market was dominated by sellers who at moments seemed to be determined to get rid of the owned shares at any price. The pessimism during the last few sessions was evident not only with the local market players, but was also dominant on a part of the regional capital markets that registered record low levels as well. The Romanian index BET lost the staggering 7.29 % only for the Thursday’s session.
Despite the unfavorable market conditions not all new listings have been postponed. The shares of the cosmetics company Astera Cosmetics AD [AST] will be introduced for trading on the BSE on March, 25th. During the week the Financial Supervision Commission approved the ipo prospectus of DOM Zdrave - a voluntary health insurance company. The company plans to offer 470 th. new shares with a minimum price of BGN 3 per share.
The report also includes:
market Trends
SOFIX (chart)
BG40 (chart)
market Statistics
| Segment | Volume (BGN) | Deals |
| Trading in Equities | 11 475 038.20 | 12407 |
| Weekly Chng | -83.31% | 32.28% |
| Trading in Corp. Bonds | 5 898 089.93 | 25 |
| Weekly Chng | -74.16% | 37.50% |
| Block Trading, Equities | 41 956 983.20 | 309 |
| Weekly Chng | 5.57% | 62.63% |
| market Capitalization: | BGN 22.84 bln / EUR 11.68* bln |
* The Bulgarian Lev is pegged to the Euro at BGN 1.95583 per EUR 1.00.
BG40 Stocks, March 21, 2008 (table)
Gainers & Losers*
| TOP GAINERS | Ticker | Sector | Weekly Chng |
| Investor.bg | IBG | internet | + 0.81% |
| Bulgarian Holding company AD | BHC | conglomerates | + 0.48% |
| Sparky Eltos AD | ELTOS | machinery | + 0.35% |
| TOP LOSERS | |||
| Petar Karaminchev | PKAR | construct. materials | -24.67% |
| Oil & Gas Explor. & Production AD | GAZ | oil & gas expl. & prod. | -21.91% |
| Zarneni Hrani Bulgaria AD | ZHGB | agriculture | -21.48% |
* Gainers: Among shares with turnover above BGN thnd 50; Losers : Among shares with turnover above BGN thnd 20
Main Economic Indicators
| 2004 | 2005 | 2006 | |
| GDP, in bln EUR | 19.57 | 21.45 | 25.10 |
| GDP, real growth, % | 6.6% | 6.2% | 6.1% |
| Inflation, year-average, % | 6.2% | 5.0% | 7.3% |
| Unemployment, year-average, % | 12.0% | 10.1% | 9.0% |
| Fiscal Balance, % GDP | 1.7% | 2.3% | 3.7% |
| Gross Public Debt, % GDP | 43.2% | 33.4% | 25.5% |
| Current Account, % GDP | -6.7% | 12.2% | -16.3% |
| Foreign Direct Investment, % GDP | 14.0% | 14.5% | 16.8% |
Yield Curves: Bulgaria vs. Eurozone (chart)
East European Markets
| index | Value | Weekly Chng | YTD Chng |
| Bulgaria SOFIX | 3 839.06 | -11.81% | -32.94% |
| Croatia CROBEX | 1185.50 | 1.09% | -28.48% |
| Macedonia MIB-10 | 6 489.84 | -7.72% | -5.47% |
| Montenegro NEX20 | 39 719.08 | 8.89% | -16.54% |
| Romania BET-C | 1 109.79 | -4.57% | -24.15% |
| Russia MICEX10 | 1 576.47 | 3.39% | -26.72% |
| Serbia BELEXline | 1 758.55 | -4.26% | -16.16% |
| Turkey ISE-100 | 26 275.97 | -7.95% | -23.10% |
| Ukraine PFTS | 6 857.70 | -4.93% | -30.20% |
| Morgan Stanley MSCI EE (€) | 585.66 | -3.97% | -19.28% |
news of the week
Economics
- Bulgaria's Gross Domestic Product (GDP) amounted to BGN 56 519.8 mln [EUR 28 898.1 mln] in 2007, the National Statistical Institute [NSI] announced. GDP grew by 6.2% in real terms compared to 2006. That corresponds to BGN 7 341.2 [EUR 3 753.5] per capita. The expectations were in the range of 5.7% to 6.0 %.
- The unemployment rate in Bulgaria stood at 7.26% in February 2008, down by 0.12 percentage points compared to January and a decrease of 2.22 percentage points compared to February 2007, the National Employment Agency announced.
Politics
- During the week Bulgaria recognized Kosovo as an independent state, a month after Kosovo declared its independence on February 17, 2008. After the decision, Serbia announced the withdrawing of its ambassador from the country. Bulgaria's main export route to Europe goes via Serbia and companies say they may lose millions if they have to bypass the country.
- The Bulgarian parliament approved the Lisbon Contract on Friday. 195 out of 210 members of the Parliament voted in favor of ratification of the contract that expands the national parliaments’ rights.
Corporate Sector
- On March 19 Sopharma [SFARM] was authorised by the Serbian Commission for Protection of the Competition to acquire the controlling stake in the firm “Ivanchich&Sons”, whose portfolio features 21 pharmaceutical products and 4 pharmacies in Belgrade. In this way the Bulgarian pharmaceutical company shall have the opportunity to continue its expansion abroad after in December last year it was granted a permission to acquire the Ukrainian company “OAO Vitamins”
- Monbat [MONBAT] summons a GSM on May 16, 2008, the agenda of which includes voting on a proposal for a capital increase from BGN 19.5 mln to BGN 39 mln. through the issuance of 19 500 000 new shares through the conversion of a part of the 2007 profit and reserves into capital. BGN 3.482 mln. from the 2007 net income shall be distributed among the shareholders as dividends (BGN 0.179 gross dividend per share), and the remaining BGN 13.927 mln. shall be used for the capital increase. The company published its investment program for 2008-2009 which amounts to BGN 64.2 mln.. The funds shall be spent for increase of the production capacity, establishment of a new subsidiary in Dobrich for production of traction batteries for electric trucks and construction of blocks of flats for the personnel.
****
To view the original document, please click on the link below:
http://reports.aiidatapro.com/BBB/Karoll/Newsletter_21.03.2008.pdf
*****
Copyright: 2006 Karoll AD. All rights reserved. For further Information please contact Karoll, 57 Hristo Botev Str, 1303 Sofia, Bulgaria |
Tel. +359 2 981 13 81, fax: +359 2 986 34 66, e-mail: research@karoll.net, web site: http://www.karoll.net
*****
AII Data Processing does not endorse in any way, the views, opinions or recommendations expressed above. The use of the Information is subject to the terms and conditions as published by the original source, which you have to read and accept in full prior to the execution of any actions taken in reliance on Information contained herein.
 | SeeNews SeeNews is a business and financial news and information provider which brings its visitors and customers access to detailed coverage on the fast-growing companies, economies and markets of ten Southeast European nations. |
Search for: news |
Search for: market |
Search for: ipo |
Search for: share |
Search for: index |
Search for: exchange |
Search for: report |
Search for: chart |
Search for: Bulgaria |
Search for: Croatia |
Search for: Macedonia |
Search for: Montenegro |
Search for: Romania |
Search for: Serbia |
 | Research & Profiles SeeNews – Research & Profiles enables an access to over 4,000 comprehensive company and industry profiles and researches from 10 Southeast European countries. |
Terms & ConditionsPrivacyCopyrightPublished by All Data Processing. All rights reserved. Created by Ladger.
Newsletter 21.03.2008.pdf, 228 Kb
