Romgaz is the largest company to be listed on the Bucharest Stock Exchange in ten years, with its value being EUR2.6 billion based on the IPO price. But if analysts’ estimates prove accurate, Romgaz’s capitalization could rise above EUR3 billion in its first day on the bourse. This would make Romgaz the second most valuable company on the Romanian bourse after OMV Petrom (SNP.RO), which is valued at EUR6 billion.
Everyone welcomes the fact that the state is bringing its largest company to the stock exchange, considering that the Romanian capital market has not managed to attract any private company in the past five years. Stock exchange investors are eager to take advantage of the rise in the price of natural gas, while the rest of the economy fears these price hikes.
The state’s commitments to boost the price of gas are the main reason why Romgaz shares remain attractive for some investors even at 20% more than the IPO price.
“I think Romgaz shares could exceed RON35 during the day,” says Carmen Arsene, analyst at Broker Cluj.
Analysts’ and fund managers’ estimates are based on the huge interest of investors for the Romgaz offer, where subscriptions on the retail segment alone totaled over EUR1.1 billion, i.e. 2.6 times the value of the entire offer.
“The price will be determined by the battle between investors who want to increase their holdings, a large part of whom will most likely plan to hold on to the shares for more than 3-6 months, and buyers in the initial public offering, drawn by the possibility of taking a profit short term,” says Claudiu Cazacu, chief analyst at brokerage XTB Romania. He expects fluctuations between the minimum price and the maximum price in the first day to be over 15%, so there will also be many speculators who will seek intra-day profits, buying and selling during the same session.
The value of transactions with Romgaz shares in the first day could be between EUR10 and EUR20 million on the Bucharest bourse alone. Tuesday also sees the start of trading for GDRs (global depository receipts) for Romgaz shares listed on the London Stock Exchange.
The Romanian state has sold 15% in Romgaz for EUR390 million in a public offering. A 9.6% stake in Romgaz will be traded on the Bucharest bourse and 5.4% of shares will be traded in London, as GDRs.
(English version by Daniela Stoican)