Petrokemija Stock Slightly Up

On the Zagreb Stock Exchange, Crobex indices could today follow the movement of indices on European exchanges, where a reaction to the eurozone economic data for the first quarter is expected, and the shares of Ericsson Nikola Tesla and AD Plastika could be in focus for domestic investors.

Of the 7 analysts from brokerage firms who participated in the Hina survey, 6 expect stagnation of Crobex today, while 1 expects an increase.

The Crobex index strengthened by 0.4 percent yesterday, reaching 1,926 points, while Crobex10 rose by 0.74 percent to 1,084 points. The regular turnover of shares amounted to 10.6 million kuna, which is approximately 2 million more than the previous day.

The largest contribution to the growth of Crobex came from the shares of Atlantic Group, whose price increased by 1.59 percent, followed by Ina at 2.38 percent, and AD Plastika at 4.2 percent.

The significant increase in the price of AD Plastika shares was prompted by the news of the signing of a contract with the brokerage house Interkapital Securities for specialist trading of the stock, which gives the mentioned stock a second so-called ‘market maker’.

“Investor activity in the domestic market is very weak, so we are recording low turnovers with stagnation or decline in stock prices. This development has also been influenced by the business results of domestic companies for the first quarter of this year, which clearly did not meet investor expectations,” emphasizes Mirko Matić, a broker at Centar banka.

Although the correlation between movements on the Zagreb Stock Exchange and foreign markets has been extremely low recently, Matić points out that it is important to highlight that the data on German and French GDP released today were slightly below economists’ expectations.

The largest European economy, Germany, recorded a GDP growth of 0.1 percent on a quarterly basis in the first quarter, which is below economists’ expectations, who had anticipated a quarterly growth of 0.3 percent on average.

At the same time, the French economy has once again fallen into recession, recording a GDP decline of 0.2 percent in the first quarter of this year. This is also a weaker figure than expected, as economists in a Reuters survey had anticipated a decline of 0.1 percent for the French economy.

“Weaker than expected GDP data from Germany and France could negatively affect movements on European exchanges. Data on the eurozone economy is expected throughout the day, and in the afternoon, data on U.S. industrial production,” says Matić.

He emphasizes that the shares of Ericsson Nikola Tesla could again be in greater focus for investors in the domestic market due to the upcoming ‘ex-dividend day’.

Ericsson NT is paying a dividend of 170 kuna per share, which implies a gross dividend yield of 11.11 percent. The ‘ex-dividend’ date is May 17.

“An interesting piece of news is also the signing of a contract for the specialist trading of AD Plastika shares, which could long-term affect the increase in liquidity for that stock and reduce implicit trading costs,” concludes Matić.

The weekly magazine Globus, on the other hand, writes today about the privatization strategy of Kutina’s Petrokemija, which involves the entry of a strategic partner, a reduction of workers by a third over the next five years, while 500 million kuna will be invested in modernization.

A government source for Globus states that it is still early to talk about candidates, but one major Russian player is expected to visit Croatia before summer. The source also noted that the state is trying to retain a controlling stake, that is, 25 percent plus one share.

The Petrokemija stock rose by 0.81 percent, and its last price at 10:15 was 228.9 kuna.