Investments on the RASDAQ market were the most profitable in the first quarter of this year, with the RASDAQ-C index witnessing a 35.2% surge since the beginning of the year - equalling the figures for 2005 and 2006 combined.
It has become increasingly obvious to investors over the past year that the highest profits on the capital market are to be made on the RASDAQ, given that most issuers on the Bucharest Stock Exchange are correctly valued, leaving little room for big profits as was the case two or three years ago.
RASDAQ has been a source of surprise to companies over the last few years, generating profits of more than 100% within a matter of months. One such example is Imotrust Arad, involved in real estate, which has posted an over 520% growth since the beginning of the year. Another similar example is Prebet Aiud, which gained over 200% in the first three months, and is to be transferred to the Bucharest Stock Exchange.
The trend of the Stock Exchange in the first quarter is one more argument to the theory that the biggest profits are made from shares of smaller and less liquid companies. The BET-C index that gauges the performance of all the issuers listed on the BSE, except the SIFs, gained about 10.7% in the first three months, while the BET index, which tracks only the top 10 companies on the Bucharest Stock Exchange increased by a mere 6.2%.
Shares of companies such as Turism Felix, Aerostar Bacau and Kandia-Excelent Bucharest yielded the highest profits on the Stock Exchange. Other than Turism Felix, whose excellent performance was due to the transfer from RASDAQ to the Stock Exchange causing its share price to double in less than one month, in the case of Aerostar and Excelent, the growth was due to the very good financial results posted last year.
Aerostar doubled its profit in 2006 and will be disbursing dividends twice as high as last year, while Kandia-Excelent posted a four-fold higher profit than in 2005. Both companies have doubled their value on the Stock Exchange since the beginning of the year.
Of all the shares that make up the BET index, Transelectrica's witnessed the highest growth, almost 40%, again because of the very good financial results reported in 2006. Transelectrica shares were introduced in the BET about a month ago, which is why their performance had little influence on the trend of the index. The shares of the real estate developer Impact also recorded a significant growth of 34%. As far as the banking sector shares are concerned, BRD stood out with a 14% increase, while the top performing petroleum company was Rompetrol Rafinare, up by 10.8%.
The shares that performed worse than expected include Petrom, which increased by less than 1% and Banca Transilvania, which did not increase by any more than 5%, despite the capital increase the bank announced. However, the main losers were the SIF shares, with the BET-FI index losing more than 6% in the first quarter due to negative news. The only ones to resist decline were SIF Transilvania's shares, which gained 9.4% as a result of the project to double the share capital by including the 2005 net income and by distributing bonus shares.
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