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The Warsaw Voice » Business » January 9, 2008
WARSAW STOCK EXCHANGE
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YEAR IN REVIEW: Hottest Ever
January 9, 2008 By A.R.    
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Last year was the best ever for the Warsaw Stock Exchange (WSE). Turnover in both shares and derivatives reached new levels; the primary market burgeoned; the NewConnect alternative market was launched; and new types of instruments hit the trading floor.

A record 81 companies were listed on the WSE in 2007, beating a 1997 record of 62 debuts. The value of offerings also reached an all-time high last year, exceeding zl.18.2 billion on the main market, including zl.15.4 billion worth of new share issues.

Among the newcomers were 12 foreign companies whose combined offerings were worth more than zl.13 billion. Eight foreign companies issued new shares in connection with their WSE debuts. The largest offering in terms of value was that of Immoeast, at over zl.10.7 billion. Orco Property Group's offering was worth zl.652 million, and Ukraine's Kernel Holding floated zl.546 million worth of shares. Last year saw the appearance of companies from markets that were not previously represented on the Warsaw trading floor, such as Estonia, Italy, Spain and Sweden.

Best stock investments in Poland in 2007
CompanyAnnual rate of return (%)
LZPS169.51
Intercars166.96
PEP153.17

At the end of 2007, a total of 351 companies, including 23 foreign ones, were listed on the WSE's main market.

In 2007, stock turnover reached an all-time high of zl.482 billion, an increase of 40 percent on the previous year. On Jan. 18, daily turnover set an all-time record of zl.3.7 billion, up from a previous record of zl.3.3 billion Nov. 10, 2004. But the record survived only until Dec. 21 last year when daily turnover exceeded zl.4.1 billion.

The exchange's capitalization increased markedly in 2007. At the end of the year, it crossed the zl.1 trillion mark for the first time ever, at zl.1.08 trillion, including zl.510 billion in domestic stock and zl.570 billion in foreign stock.

The capitalization of WSE-listed companies rose by around zl.440 billion from the end of 2006, while the capitalization of foreign companies listed in Warsaw nearly tripled, from zl.198 billion to zl.570 billion. Much of this growth was attributable to the Dec. 20 listing of UniCredit, a company with a capitalization of around zl.270 billion.

The total volume of trading in derivatives approached 10 million in 2007, up by 48 percent from 2006. The total value of turnover in derivatives was zl.661 billion, up by 75 percent from 2006.

In 2007, two new issuers of what are called structured products appeared on the WSE, Erste Bank and Raiffeisen Centrobank (RCB). At the moment, three companies offer structured products on the WSE: Deutsche Bank London with structured bonds, and Erste Bank and RCB with structured certificates. In all, 12 series of products are offered, including products tied to foreign indices and a basket of shares and commodities such as oil and gold.

The Warsaw Stock Exchange Aug. 30 launched a new alternative market called NewConnect. The market is intended for small and medium-sized companies with high growth potential. NewConnect has the status of an organized market but is run by the WSE outside the regulated market system-in the form of an alternative trading platform.

At the first session, shares of five companies were traded on NewConnect: Digital Avenue, S4E, ViaGuara, Virtual Vision, and Wroc³awski Dom Maklerski. By the end of the year, 24 companies entered this market. The value of their offerings exceeded zl.150 million, including more than zl.145 million in new issues. Most of the companies newly listed on NewConnect chose to sell their shares through private placements.

The largest offering in terms of value was that of LUG, at more than zl.20.5 million. Five other companies had offerings worth more than zl.10 million each: Stark Development, Inwest Connect, Mera Schody, WDM, and MW Trade. The offering of e-muzyka was the lowest in value, at zl.1.6 million.

The NewConnect market has its own NCIndex that includes all the companies listed on the alternative market. The opening value of the index on Aug. 30 was 100 points. By the end of the year the NCIndex rose to 144.17 points. In 2007, total turnover on the NewConnect market exceeded zl.303 million, with more than 58,000 transactions in all. At the end of the year, the capitalization of the market's 24 companies exceeded zl.1.1 billion.

WSE President Ludwik Sobolewski says around 70 new companies will be listed on the main market in 2008 and a further 80 or so on NewConnect. Some 15 to 20 foreign companies are expected to hit the exchange's main market. As a result, the number of foreign companies listed on the WSE would exceed 40.

WSE main market highlights
End of 2006End of 2007
WIG203,285.493,456.05
WIG50,411.8255,648.54
Number of listed companies284.00351.00
Number of new companies38.0081.00
Capitalization of domestic companies (zl. billion)437.72509.89
Total capitalization (zl. billion)635.911,080.26
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