— GENX racks up 25% return in 1H07, EUR 8 bln extra wealth created in 2007
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The combined market capitalization of the Cyprus Stock Exchange (CSE) reached EUR 20.5 bln as of July 3, which means that it is now 1.5 times larger than the country’s gross domestic product (GDP), according to Financial Mirror data.
The Statistics Service has forecast that
In other words, the 2007 rally in CSE stocks has created a further EUR 8 bln in additional wealth for investors, considering that the total equity market cap of the CSE at the end of 2006 amounted to EUR 12.5 bln.
The CSE GENX, made up of only Main and Parallel stocks, ended July 3 at a fresh record close of 4863 points, up 24.69% compared to its 2006 close of 3900, placing it among the best performing equity markets of Europe.
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— Getting to 1999 levels
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In an interesting twist, the CSE’s market cap of EUR 20.5 bln is very close to the total market cap of CYP 12.8 bln or EUR 22 bln reached at the end of 1999, at the height of the CSE bubble after which stock prices collapsed, sending the CSE All-Share index from levels of around 900 to 70 by 2003. The CSE GENX was re-launched in September 2000 at a base of 1000 and since then has more than quadrupled in value.
In 1999 though, the CSE market cap was made up of 25 stocks, while today, it is made up of 160 stocks. Back then, there were scant profits and the market was driven by excess liquidity chasing few titles, with very slow settlement, which added to the lack of supply of shares in the market.
These days, the profit reporting companies listed on the CSE make up EUR 20.1 bln of market cap, the majority are reporting sharp increases in profitability, and Cyprus’ major stocks are now covered by investment reports issued by reputable investment houses such as Citi, Chase, Morgan, Deutsche and UBS to name a few. The CSE has meanwhile moved to a fully dematerialized settlement system and the bourse has established a common trading platform with the Athens Stock Exchange, which in the process has attracted a wave of acquisitions originating mainly from
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— Banks dominate
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Bank of Cyprus boasts a market cap of EUR 7.1 bln, Marfin Popular Bank EUR 7.3 bln and Hellenic Bank EUR 1.1 bln. The fourth largest stock is Louis Plc, the cruising and hotel group with a market cap of EUR 211 mln, followed by Cyprus Trading Corporation, the retailing/trading conglomerate with a market cap of EUR 164 mln.
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— Good performance
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The Main Market boasts a total market cap of EUR 16.9 bln and represents 82% of the total. Since the start of the year, the Main Market sub-index is up 24.3%. The Parallel Market, up 48.7% since the start of the year, boasts a market cap of EUR 0.6 bln.
The Alternative Market, where majority shareholders can increase their stakes up to 90%, there is no need to implement the CSE’s Corporate Governance code and reporting is mandatory twice a year, the total market cap is now EUR 2.2 bln with the sub-index having rallied 64% since the start of the year.
The Approved Investments sector, up 14% since the start of the year has a total market cap of EUR 550 mln, while the Shipping sector with one company has a cap of EUR 97 mln. The Special Category, which harbours companies that fail to meet the minimum requirements have a total market cap of EUR 140 mln.
The warrants sector boasts a market cap of EUR 120 mln, while the total market cap of the bonds listed on the CSE as end of May amounted to EUR 522 mln. Both sectors were not included in the Financial Mirror calculation.
