For today we are bringing you an overview of the share price performance of various sectors in the regional market since for 2021 so far.

For this, we observed primarily the median YTD share price performance of companies in our wider coverage from Croatia, Bulgaria, Slovenia, Romania and Serbia.

End of 2020 was marked by a positive sentiment on the regional equity markets, following the vaccine development, while the similar trend seems to be the case in the beginning of 2021 with almost all industries being in the green (apart from the Banking sector). Observing the graph below, we see that the Energy sector has the largest increase with the median YTD share price rising 12.5% (average of 10.2%). Leading the recovery in the industry is Romanian Nuclearelectrica with YTD share price increase of 27.1%. 2020 had been particularly challenging for the energy sector with remarkable declines in oil demand due to flight bans, closing factories and restricted movement.

The second strongest performance can be seen in the Utility sector with the median YTD share price rising 11.0% with Romanian company Conpet towering over others with YTD gain of 28.1% bringing their share price to RON 97.6. The final double-digit winner is the Construction industry with median YTD share price increase of 10.65%.

Furthermore, the Shipping and Pharma are also in the green so far this year with 8.8% and 6.7% rise, respectively. Tourism sector which had a very strong uplift at the end of the year still continued its positive sentiment, however with a significant slowdown, being up 2.1% since the beginning of 2021.

On the flip side, the banking sector is the only one in red for this year with the median stock price falling 0.15% (average of 0.53%). The biggest loser so far this year is PBZ with a fall of 4.8% YTD. As a reminder, in early November, PBZ has announced its delisting from ZSE. We note that the banks in our wider coverage are currently traded at a median P/B of 0.7.

In 2020, GWPs recorded an increase of 2% YoY. Of that Non-life observed an increase of 3.1%, while Life is down by 0.4%

The Slovenian Insurance Association published their monthly update on the GWP development in Slovenia. In 2020, the Slovenian insurance market showed solid resilience with regards to the pandemic, as GWPs increased by 2% YoY to EUR 2.568bn. Of that non-life segment stood at EUR 1.82bn (+3.1% or EUR 54.5m).  

GWP development (2017 – 2020) (%)

The mentioned segment, which accounts for 70.8% of the total GWPs, showed a very solid performance on the back of a very strong health insurance performance (+7.1% YoY). The increase in Health insurance premiums, as the largest non-life item, arguably came mostly on the back of increasing prices of health insurance premiums.

It is noteworthy that land motor vehicles insurance observed an increase of 3.3%, amounting to EUR 319.3m. Meanwhile motor vehicle liability insurance witnessed a slight decrease of 0.7%, amounting to EUR 272.98m. Of all insurance segments, Credit insurance observed the highest decrease of 20.1%. This does not come as a surprise given the expected lower loan issuance activity in Slovenia as a result of Covid-19 outbreak coupled with the restrictions on the consumer loans placed by the Bank of Slovenia in November 2019.

GWPs by Insurance Segment 2020 (%)

Turning our attention to the life segment, it recorded a 0.4% YoY decrease in 2020. To be specific, the entire life insurance segment amounted to EUR 751m. Within the segment, unit-linked life insurance observed decrease of 4.3%.

All of the above is quite encouraging for the FY 2020 results ahead of Slovenian Insurers Triglav and Sava Re. We note that both companies will likely outperform the Slovenian market (both on a Slovenian and Group level), in terms of total GWP growth.

Top and Bottom Performing Segment 2020 (EUR m)