Block transactions represent an important way of trading in less liquid markets as they are used to lessen the impact that a large transaction has on the price of certain security. For this reason, we decided to present you with an overview of how much value is traded through equity block transactions as opposed to regular market transactions on the Croatian market.
A block trade represents a transaction between two parties that involves the sale or purchase of a large number of securities. Such a transaction involves a significantly larger number of equities or bonds being traded at an arranged price between two parties, sometimes outside of the open markets. Currently, the minimum amount for a block transaction on the Zagreb Stock Exchange is HRK 2m. Such transactions represent an important way of trading in less liquid markets as they are used to lessen the impact that a large transaction has on the price of certain security. For this reason, we decided to present you with an overview of how much value is traded through equity block transactions as opposed to regular market transactions on the Croatian market.
Equity Turnover Breakdown (HRK m)
Looking at the charts one can notice that the share of block transactions in the total equity turnover has been gradually increasing over the years as the liquidity of the market has decreased with 2016 being the year when block transactions had the highest share. Meanwhile 2018, thus far, records the second-highest share of block transactions. In 2021, the share of block transactions in total equity turnover increased slightly to 21%. In Q1 2022, the Croatian Stock Exchange already achieved 67% of last year’s block transactions and 40% of the total 2021 equity turnover. If block transactions in 2022 would continue at this pace, it would surpass previous years and they may achieve the levels of 2016 block transactions. In the case of multiplying the result of Q1 2022 by the number of quarters in a year, we can expect block transactions to reach levels around HRK 1.4bn.
Block Transaction as % Of Total Turnover
In March 2022, tourist arrivals amounted to 326.1k, an increase of more than 2x YoY, while tourist overnight stays amounted to 961.5k, an almost 2x increase YoY.
The Croatian Tourist Board has published the latest report on the changes in the tourism industry in March 2022. In it, we can see that during the month, the total tourist arrivals and overnight stays doubled, as compared to March 2021. This increase continues the trend that was seen during the last several quarters, as the tourism industry had a strong rebound, owing to good vaccination rates, as well as lenient travel and restriction measures. With the Croatian Government’s recent announcement of the lifting of most measures regarding the pandemic, as well as the lifting of travel restrictions to EU countries, (to be effective starting 9 April 2022), this trend will surely continue in April and going forward, and 2022 is setting itself up for a strong tourism season.
Since this measure is new, current bookings still do not reflect the benefits it will give, but this situation will surely change as the summer season approaches.
Meanwhile, looking back to March 2022, the total tourist arrivals amounted to 326.1k, an increase of 122% YoY. Out of that, 199k were foreign tourists (or 61%), representing an increase of over 3x compared to March 2021. At the same time, domestic tourist nights amounted to 126.9k, an increase of 31% YoY.
Moving on to the tourist nights, they amounted to 961.5k in March 2022. Out of that number, 676.6k (or 70%) were foreign tourists, representing an increase of 170% YoY. Domestic tourist nights amounted to 284.9k, an increase of 22% YoY. This would also mean that the average stay per person decreased from 3.30 nights per person to 2.95 nights per person, an ongoing trend that can be attributed to the looser movement restrictions, allowing tourists to move more and visit more places.
In March 2022, domestic tourists had the largest share of tourist nights, accounting for 30%, followed by Slovenian tourists with 11%, and German tourists with 9%. Looking at the most visited counties, Istra had the most tourist nights with 261.8k, followed by Kvarner with 166.2k, and Grad Zagreb with 133.6k.
In total, from the start of 2022 til the end of March, arrivals amounted to 739.7k, an increase of 109%, while total tourist nights amounted to 2.21m, an increase of 90% YoY.