For today we are bringing you an overview of the share price performance of various sectors in the regional market on a YoY basis to see how sectors performed during most of 2022.
For this, we observed primarily the median YoY share price performance of companies in our wider coverage from Croatia, Slovenia, Bulgaria, Romania, and Serbia.
The end of 2021 was marked by positive sentiment on the regional equity markets, following the high vaccination rates, while a similar positive trend continued in the beginning of 2022 with most industries being in the green. However, the tide has turned in the first quarter of 2022 with Russian invasion of Ukraine that spurred a flight from equity and strong volatility that countinues throughout the year. Consequently, the majority of sectors reported a negative YoY price movement with more than half of sectors that were in red reporting a double-digit decline.
Observing the graph below, we can see that the shipping sector has by far the largest increase with a median YoY share price increase of 10.5%. Shipping was primarily driven by Jadroplov, which noted a share price increase of more than 20%. Further, we note Atlantska Plovidba achieved strong results in the first half of 2022, but the returns diminished from that point – resulting in a more or less flattish price movement. However, the Shipping sector in the region outperformed other ones without a doubt.
The shipping is followed by Funds/REIT with also high median YoY share price performance of 8%. However, we note the sample for this category is relatively small and might not be representative on a wider scale. Energy and Infrastructure follow with a median YoY share price increase of 2.1% and 0%, respectively. Energy rounded up with a median return of 8%. This sector is mostly represented by Romanian companies with flattish returns on a YoY basis. However, we emphasize the price movement was volatile and if a slightly different time frame was used, returns could vary significantly due to high energy prices on a global scale.
However, each of the remaining sectors noted a negative YoY return with Construction and Telecommunication leading the list with 24.9% and 18.% decline, respectively. Telecommunication was primarily driven by Romanian Digi and Telekom Slovenije, both of which reported a double-digit decline. Furthermore, Banks and Food were also in red, decreasing by 13.4% and 13.3%, respectively. Tourism, Insurance, Pharma, Diversified and Industrials all noted a decline with 10.7%, 10.2%, 9.9%, 9% and 8.5% YoY decline, respectively. Looking at these sectors, we note that Pharma was primarily influenced by Krka with an almost 20% share price decline due to the geopolitical situation influencing the company’s operations. Further, Diversified noted a mentioned 9% decline which was primarily driven by Petrol’s high double-digit price decline. As we are all aware of, Petrol’s operations suffered due to the Croatian & Slovenian government interventions. This decline was slightly offset by Podravka’s flattish price development.
YoY Returns by sector (%)
Source: Bloomberg, InterCapital Research