Investors Relations Presentation June 2020
Bucharest Stock Exchange (BVB) Price evolution of BVB vs. BET index (5 years) Indicator BVB ISIN ROBVBAACNOR0 50 12,000 Refinitiv ROBVB.BX BVB BET index (rhs) Bloomberg BVB.RO 10,000 40 Share price (May 25, 2020) EUR 5.04 / RON 24.4 Market Cap (May 25, 2020) EUR 40.6 mn/ RON 196.4 mn 8,000 30 8,049,246 No. of outstanding shares 6,000 ADT 12TM RON 0.09 mn 20 24.89x* P/E (price as of May 2020, 12TM EPS) 4,000 P/BV (price as of May 2020) 1.74x* Dividend Yield 3.3% 10 2,000 19.00 – 27.50 52 wk Low - High 12% Turnover velocity (12 TM ) 0 - P/E and P/B are calculated based on BVB Group preliminary financials as of March 2020 2015 2016 2017 2018 2019 2020 Data as of 25.05.2020 Shareholding structure as of April 2020 : 100% free-float , listed on its own floor since 2010 Romanian institutional investors – 73.79% 20% ownership threshold , majority institutional shareholders Foreign institutional investors – 6.88% Romanian private investors – 16.3% Foreign private investors – 1.98% Significant investors > 5%: SIF Transilvania, NN Group N.V., EBRD Bucharest Stock Exchange – 1.05% 2 Source: BVB, Refinitiv Eikon
Growth story in the Emerging Europe Promotion to Romanian capital market has been promoted to the Emerging Market status by FTSE Russell. The Emerging Market reclassification of the status will become effective in September 2020. Potential The state seems keen to resume SOEs IPOs. Growing pipeline of private companies looking at privatizations and financing options through the stock exchange. new listings Pension funds’ total assets reached EUR 13.5 bn at the end of 2019, 27% higher than the end of the Growing Domestic previous year while the AuM of the investment funds (apart from SIFs and FP) increased to EUR 5.4 Potential bn at the end of 2019. Impressive Romanian Capital Market recorded one of the highest dividend yields in the world, averaging 8% in dividend yield 2019 and estimated 5.1% in 2020 BVB has partnered with energy and financial institutions to put the basis for the Central CCP Counterparty 3
Historic moment - Romania was promoted to Emerging Market status FTSE Country Classification Review, September 2019 FTSE Romania has been promoted to MSCI Global Market Accessibility Review, Secondary Emerging Market status 3 years after being introduced on the June 2019 watchlist MSCI In June 2019, MSCI upgraded Romania on Transferability after the market received 3 additional upgrades on S&P Dow Jones Country Classification Trading, Market Regulations and Consultation Results, October 2017 Information Flow a year earlier “Of the countries listed in the S&P consultation, Poland and Romania were cited most often as countries where a classification change could be justified. As such, they may be included in future consultations if conditions continue to improve” 4 Source: FTSE Russell, MSCI, S&P Global
Major potential for Romania to at least double its Market Cap to GDP ratio Poland 27% Hungary 20% ADT: EUR 48.4 mn/day ADT: EUR 260.2 mn/day Mkt. Cap.: EUR 19.6 bn Mkt. Cap.: EUR 102.5 bn # 44 companies # 449 companies Czech Rep. Austria 30% 11% ADT: EUR 17.9 mn/day ADT: EUR 152.7 mn/day Mkt. Cap.: EUR 23.4 bn Mkt. Cap.: EUR 86.1 bn # 55 companies # 778 companies Croatia 39% ADT: EUR 2.5 mn/day Mkt. Cap.: EUR 17.4 bn # 119 companies Romania 11% Bulgaria 8% ADT: EUR 10.4 mn/day ADT: EUR 0.7 mn/day Mkt. Cap.: EUR 18.4 bn Market Cap. / GDP Mkt. Cap.: EUR 4.1 bn # 84 companies on Main Market # 81 companies Market Capitalization and ADT as of 30.04.2020 GDP as of 31.12.2018 5 Source: Refinitiv, FESE, BVB, GPW, WBAG, BSE, ZSE
Diversified Market size and structure Market Structure by traded turnover Market Structure by capitalization Sphera Franchise Group, 1% Medlife, 1% SIF Banat Crisana, 1% Others, 7% Aerostar, 1% SIF Transilvania, 1% SIF Transilvania, 1% Transelectrica, 1% SIF Moldova, 1% Others, 8% SIF Banat Crisana, 1% Transelectrica, 1% SIF Oltenia, 1% Transgaz, 2% Alro, 1% SIF Moldova, 2% SIF Oltenia, 2% OMV Petrom, 21% Rompetrol Rafinare, 2% DIGI Communications, 2% Banca Transilvania, 29% Zentiva, 2% DIGI Communications, Nuclearelectrica, 2% 3% Electrica, 4% Electrica, 3% Romgaz, 12% Transgaz, 4% OMV Petrom, 9% Fondul Proprietatea, 14% Fondul Proprietatea, Nuclearelectrica, 4% Banca Transilvania, Romgaz, 11% 9% 12% BRD Societe BRD Societe Generale, 13% Generale, 10% Note: (%) of share turnover; (%) of market capitalization 6 Data as of January 31, 2020
Significant IPOs over the past 5 years amounting EUR 362 mn IPO on the Main Market, carried out in IPO on the Main Market, carried out between in 2016 when 44% stake was sold by the 2017. Largest private IPO in the BVB history shareholders for RON 230 mn (EUR 50.5 following the sale of 25,6% stake in the mn). company for RON 944 mn (EUR 207 mn). IPO on the Main Market, carried in 2017, closed IPO on the Main Market, carried out in after less than 48 hours following the subscription 2017 when 25% stake was sold by the rate over 270%. 25% stake sold by shareholders shareholders for RON 285 mn (EUR 62 for RON 9 mn (EUR 2 mn). mn). IPO on the Main Market, carried in 2017, closed IPO on the Main Market, following the after less than 48 hours following the subscription sale of 49% stake in the company for rate of over 270%. 15% stake sold by RON 186 mn (EUR 40 mn) shareholders for RON 5.5 mn (EUR 1.2 mn). Source: BVB 7
More than EUR 5.5 bn raised over the past 5 years through bonds issues and listings Romanian Finance Ministry – EUR 1.7 bn Globalworth – Real Estate - EUR 1.1 bn raised, 14 issuances raised, 2 issuances City of Bucharest, EUR 610 mn raised, 5 NE Property – Real Estate - EUR 1 bn raised, 2 issuances issuances Unicredit EUR 135 mn , 3 issuances IIB – Supranational – EUR 460 mn raised, 7 issuances BT Leasing EUR 40 mn , 2 issuances Banca Transilvania EUR 285 mn raised Investia Finance SA Source: BVB 8
Romania offers attractive dividend yields BET index dividend yield vs. Avg. Ro.10Y treasury bond BET index companies dividend yield in 2020 e 10% BET Dividend Yield Avg. Romania 10 Y Gov. bond yield Dividend yield 2020 e BET avg. dividend yield e 10% 9% 8.7% 9% 8.0% 8% 8% 7% 7% 5.8% 6% 6% 5.1% 5.4% 5.1% 4.8% 5% 4.7% 4.6% 5% 4.0% 4% 3.6% 4% 3.4% 3% 3% 2.5% 2% 2% 1% 1% 0% 0% 2015 2016 2017 2018 2019 2020 Source: BVB, Refinitiv Eikon 9 Dividend yield for 2020 was calculated as gross dividend divided by the latest price available before ex-date. Data until 25.05.2020
Growing pension funds and asset management industry Open ended funds: Net Assets & Equity allocation Pension Funds: Total Assets & Equity allocation 16 25.0% 22.0% 6 0 18.9% 14 0 19.7% 19.2% 19.1% 5.34 18.7% 5 20.0% 5.27 17.5% 5.21 0 5.0 12 4.63 15.4% 0 4.3 4 10 15.0% 0 11.2% 8 3 0 8.7% 3.2 13.5 13.4 7.5% 10.0% 0 6 6.5% 6.5% 10.6 2 0 8.9 4.6% 4.6% 4.6% 4.4% 1.9 4 7.3 5.0% 0 5.7 1 4.5 2 3.3 0 2.3 0 0.0% 0 0 2012 2013 2014 2015 2016 2017 2018 2019 2020 2012 2013 2014 2015 2016 2017 2018 2019 Net Assets (EUR, bn) Equity allocation (%) Pillar II & III Total Assets (EUR bn) Equity allocation (%) Source: ASF, AAF 10 Pillar 2 data as of April 2020. Open ended funds data as of December 2019.
Mid-term strategic objective: Double the market liquidity Establishing the Romanian Increasing retail investors CCP and launching the base derivatives market Double Improving issuers’ the Attracting more issuers transparency and Liquidity coverage Improving the financial Better international education of the visibility – EM promotion market participants 11
A healthy market evolution will only be supported by a CCP Phase III – Other asset classes Regulated 1.5 years (e.g. Repo) lending platform Phase II – Single Stock Index Futures 1.5 years Options Currency (FX) Energy Futures Derivatives Phase I - 1 year Single Stock CCP Futures establishment and launching We are here.. of Derivatives market Spot OTC Lending & Market Borrowing Liberalization 12
Government Related Projects Hidroelectrica IPO – Back on the priority list for the Government. Ongoing selection process for advisors. Expected in Q4 2020 / Q1 2021 Other privatizations: CEC Bank, Bucharest Airports – public intentions from the Government officials. Starting date is yet to be decided Fiscal changes – Challenging taxation system for retail investors. Discussions for a more investor - friendly approach are held 13
Other projects New Listings: M omentum in the primary bond market - 10 listings in Q4 2019 alone. Private companies IPOs. Positive developments and potential for larger size issuers Launch of Vektor index, January 2020 – evaluates the IR performance of the listed companies New BVB market making scheme & issuer market making kicking off (2 companies hiring market makers so far in 2020) ESG inquiries on the rise from issuers and buy-side. Ongoing discussions with ESG provider Market data product list update 14
Financial Education at BVB Investor Forums in Bucharest and across the country, Fluent in Finance and many other projects aiming to improve financial education 15
Recommend
More recommend
