Today, we’re bringing you the YTD overview of the sectoral performance of many companies in the region, included in our “Daily Trading Multiples of Regional Companies”. Through this comparison, we can see that the best performers included the construction and insurance sectors, while the worst performers included the real estate and food sectors.
First off, a small disclaimer. This overview includes only the companies that are available in our “Daily Trading Multiples of Regional Companies”, a part of our IC Morning Blend that we publish daily. All the sectors included here, as well as the constituent companies, are available for a more in-depth overview in that document. The calculation of the final numbers takes median numbers into account instead of the average, to deal with the potential one-offs which might otherwise offset the true results.
2025 YTD performance of sectors in the region (2025 YTD, %)
Source: Bloomberg, InterCapital Research
In terms of sectors, the best performing sector was the construction sector, which recorded an increase of 15.7% YTD, mainly driven by IGH which grew by 26.7%, Dalekovod with a 15.7% increase, but also supported by ING-GRAD’s 5.7% increase, although it should be noted that the numbers for ING-GRAD are since the listing date on 10 March 2025. For all of these companies, the growth was supported by the strong demand in the construction sector, improved economic situation (such as lower financing costs due to the decrease in the ECB interest rates, which means loan production, primarily used for real estate in Croatia is high), which in turn, led to good financial results. For IGH in particular, the Company has been struggling in the last couple of years, but growth was supported both by announcements of new contracts, but also by quite low liquidity. For Dalekovod, ever since the closer cooperation and integration with Končar, the Company has recorded better and better financial results, while ING-GRAD, the newest IPO on ZSE, has a huge backlog in high-margin segments, meaning that revenue and profitability growth is expected to continue in the coming period.
Next up, we have the insurance sector, with Sava Re and Triglav growing by double-digit numbers, i.e. 21.5% and 13.8% on a YTD basis, respectively, supported by the profitability recovery and growth (especially for Triglav), and their leadership position in the region, which allowed both companies to record positive financial results and growth. Triglav also recently outlined its strategic ambitions until 2030, aiming to double EBT to EUR 250-300m in 2030, as compared to the projected 2030 numbers. Lastly, Croatia osiguranje also recorded a noteworthy 7.4% growth on a YTD basis, with the company recording double-digit revenue and net profit growth while maintaining its leadership position in Croatia, especially in the Non-Life segment.
The next sector on the list is diversified, which includes Petrol, Adris grupa, and Podravka (since it also includes the pharma business, it is not part of the food&beverage sector, even though it accounts for the majority of the Company’s operations). Petrol itself recorded a noteworthy 37% jump YTD, but it should be noted that the Company has been under a lot of pressure in the last couple of years as it acts as a distributor of petrol, electricity and gas, meaning that they were probably following the start of the war in Ukraine, due to disruption of delivery from Gazprom and governments’ intervention on gas margin and prices of commodities for distribution. However, recently the situation largely stabilized, and improved petrol margin and strong growth in retail sales allowed the growth of gross profit. Due to Petrol’s resale business best tracked P&L line is Gross profit instead of revenue, which was up in 2024 8% YoY and its net earnings were up 2% YoY. The Company’s price was also supported by the recent S&P Global Ratings rating action, which affirmed Petrol’s credit rating, indicating the Company’s stable financial position. Next up, Adris grupa also recorded a 12% increase on a YTD basis, with the Company’s revenue exceeding 1bn in 2024, supported both by results from Croatia osiguranje (part of Adris grupa), but also Maistra and HUP-Zagreb, which due to favorable tourism situation last year also recorded good financial results.
Lastly, Podravka recorded a 4% drop on a YTD basis, however, this could be seen more as a correction, as the Company’s share has appreciated strongly in the last couple of years, while its financial results, both revenue and net profit continue to grow. Furthermore, Podravka recently finished the acquisition of Fortenova’s agricultural business, something that was already “priced in” thus further supporting the observation that this might just be a short-term correction on the price.
The infrastructure sector is next, and this includes 2 Croatian ports (Luka Ploče and Luka Rijeka), which grew by 11.5% and 2.2%, respectively, as well as Luka Koper, which increased by 18% on a YTD basis, respectively. The demand in ports has been and continues to increase, and with the better geopolitical situation, and lower inflation overall, more trade and transportation have been done, supporting the companies in question financial results.
The last sector which recorded a YTD increase of >10% was the telecommunications sector, with a 10.1% increase YTD. This includes Telekom Slovenije with a 15.7% increase YTD, Telekom Austria with a 10.9% increase, Hrvatski Telekom with 9.2%, and Digi with a 4.1% increase. While many see this sector as “stable”, especially relative to other industries, the sector has overall been seeing steady revenue and profitability growth, in line with the expansion of the number of users, the switch of users to more profitable segments, but also due to price indexation, especially in Croatia. It’s also worth noting that HT recently announced its intention to spin out its mobile tower assets into a fully owned subsidiary, citing improved efficiency, something that has been much speculated on in regards to Telekom Slovenije, although no official statements have been made.
On the flip side, laggards include the real estate and the food sector, with decreases of 3% and 2.8%, respectively. In the real estate sector, One United Properties recorded a 10.4% decline YTD, as the overall economic and political situation in Romania is quite gloomy, even though the Company recorded stable financial results on many lines. The company also had a capital increase in 2024 at a nominal price and it is also investing in the hospitality business in the center of Bucharest, which is a novelty as it was mostly engaged in retail and commercial space building and renting. Equinox, on the other hand, recorded better results YoY, although it was not enough to offset to overall drop of One United Properties.
The food sector on the other hand, mainly recorded a drop due to a 19.3% drop in Kraš and a 4% drop by Atlantic Grupa. Both companies were hit by higher raw commodity prices, especially cocoa (and coffee for Atlantic Grupa), while the high inflation in the last couple of years meant that there wasn’t much room to raise prices further. Furthermore, for Kraš, there have been some changes in the shareholder structure which have also affected the price.
Overall, the first 3 months (almost complete ones) have been rather positive for many of the sectors, with most of them recording either single or double-digit growth rates. If the current macroeconomic situation improves, more investments are made into economies overall, and the war in Ukraine is brought to an end, the outlook and thus sentiment could end up even better, however, all of this might be weighted down by the possible tariffs and retaliatory tariffs on both sides of the Atlantic, something that as of now remains quite uncertain.
