by The market confirms its momentum and shows that after the election results, the forces have been released and many of those who were cautious due to political risk are furiously buying Greek assets. The good fundamentals were known, but there was uncertainty. Now it has moved away and the shares are rising and sharp. Our previous reports on stocks such as Aegean, Kri-Kri and OPAP were written because the fundamentals support higher levels. Yesterday we saw a lot of movement in most of them, a development that confirms the assessment of the column, that we are back to normality. Big rise yesterday for Aegean Airlines, Kri-Kri and other stocks that had news.
Historic highs for Viohalco, Autohellas, Cenergy, perennial for GEK TERNA, but a positive development was that mid-cap and small-cap stocks also rebounded. Although there are significant values in this category, the lack of investors and even small investors has discredited the image of many stocks.
We have seen a significant increase in Real Consulting, Intracat, Technical Olympiaki, Intracom, SIDMA and others. We hope this trend continues as many deserve better valuation levels.
Excellent, as analysts expected, was the first quarter of the CPP and we believe it lays the foundation for a dividend distribution to its shareholders after many years. Turnover reached 2 billion euros with EBITDA rising from 170 million euros to 280.5 million euros, an increase of 65%. And there, it seems that the target of 1.1 billion euros set by the administration is on track, even if the CEO of PPC, George Stassis raised the target a little to 1.2 billion euros!
Net profit amounted to 51.1 million euros, while in the first quarter of last year it recorded a loss of 186 million euros. Mr. Stassis said that after a year full of challenges, PPC is resolutely pursuing the implementation of its transformation plan with investments both in Greece and abroad with the ultimate goal of transforming it into an energy company. leader in the NE. Europe. Total investments amounted to 195.5 million euros compared to 102 million euros, the increase being due to investments in the distribution network, in RES projects, but also in the new natural gas plant of 840 MW in Alexandroupoli. Compared to the last quarter, the net financing requirement is down (2.03 billion euros).
As demonstrated by the first quarter results, the management ofth OPAP in the analysts’ update, he reiterated his estimate of EBITDA for the whole of 2023 between €740 million and €760 million and pointed out that after the publication of the second quarter results, he would return with more.
The trend from the first quarter continues into the second as well, as management focuses on improving the player experience across all categories in which it operates. According with Jan Karas, CEO of OPAP, significant progress has been made against strategic priorities for the online marketplace. In particular, the renewed sports betting platform of Pamestoixima.gr offers a competitive and attractive proposal, with the aim of improving interaction with customers and gaming activity. The full potential of the new platform should emerge with the start of the new sports season.
Opaponline.gr, the new platform recently introduced, offers customers the opportunity to play OPAP number games online. The company’s ambition is to make Opaponline.gr an online entertainment center. According to the management of the company, the first signs of the operation are encouraging.
The improvement of the business environment, the health of the banking sector and the reforms within the framework of the national recovery plan will provide significant support for the economic development of Greece in the event that New Democracy forms an independent government during the new elections and given its dominance in last Sunday’s election, he says Moody’s in his report.
The continuation of fiscal and economic policy is a positive element for Greece’s solvency, which, combined with the commitment to fiscal adjustment and an increase in primary surpluses, improves the prospects for a significant reduction in the burden of public debt.
Greece, according to Moody’s, will score one of the biggest worldwide debt reductions. Indeed, general government debt could fall below 150% of GDP in 2025 from 171.3% in 2022, with the outlook for nominal GDP growth in the coming years being significantly higher.
At the same time, the acquisition of investment grade is also expected, since, as Moody’s reports, our country has the best debt profile due to its duration, but also due to the fact that it is between “official hands”, the financial situation has been settled, the reforms are progressing and the “red loans” have clearly decreased.
Upgrading Greece to investment grade will allow it to participate in all ECB operations and return to normal in terms of monetary policy, as it is the only country in Europe outside of investment grade of investment.
The key points for investment grade are the four credit ratings expected over the July-October period, namely Fitch’s on June 9, Moody’s on September 15, DBRS on September 8 and S&P on October 20.
The dynamic increase in sales expected over the next three years will give a new impetus to investments by Greek companies, and in particular by small and medium-sized ones. On average, on an annual basis, this increase is estimated at 7% (compared to 5% in 2022), at least for 50% of companies. For this reason, they plan to allocate more capital than in the previous three years.
This is stated in a related report of the National Bankwhich notes that in addition to quantitative support, qualitative upgrading of investment plans is also important, which are characterized by a balanced combination of capacity increase in production and promotion, but also improved efficiency mainly through digital actions.
On the basis of these data, approximately 40% of SMEs are planning for 2023 either an increase in the workforce or an increase in fixed assets, with 12% combining the two. These developments, according to the report of the National Bank, are due to the return of the economy to a significant acceleration after the pandemic and the energy crisis which has not yet completely defused.
This element is supported by the eight-point increase recorded by the SME confidence index in the first half of 2023, after a long period of deterioration due to successive crises. Concretely, it has already covered 2/3 of the losses caused initially by the pandemic and then by the energy crisis. The improvement in the business climate has led to a sharp increase in the percentage of companies following growth strategies, which stands at 57% of the SME sector (compared to 47% in the previous semester).
Within 24 hours of warning by Fitchthe rating agency DBRS issued a similar warning on the US AAA rating. “It is being reviewed with a negative outlook to reflect the risk that Congress may not raise or suspend the government’s borrowing limit in time. If Congress does not act, the US federal government will not be able to pay all of its obligations,” analysts said.
As markets focused on the suspense of the debt ceiling hike and the risk of the US losing its AAA rating, Europe appeared oblivious to news that its largest economy was entering recession. , Germany, in the first months of 2023. US short-term borrowing costs rose more than 7% after Fitch decided to review the credit rating for a possible downgrade.
In Washington, negotiators between President Biden and the Republican Speaker of the House of Representatives had “productive talks” but with no end in sight to the deadlock and markets remain concerned about the possibility of a technical default early June. A downgrade of the US rating by rating agencies could affect the price of trillions of US bonds. Fitch’s decision was reminiscent of the 2011 episode when the S&P house it downgraded the United States, causing turmoil and a sell-off in the stock market.
A little over six months have already passed since the entry into force of the ban on the import of Russian crude oil into the European Union and the establishment of its maximum price G7 countries. In addition, more than three months have passed since the ban on imports of Russian diesel and other refined crude oil products into the European Union. As will be remembered, the purpose of the measures was to reduce the revenue brought to the Russian government by the sale of crude oil and its refined products without disturbing the international market.
With regard to crude oil, the result of these measures is the significant change in the map of the world market. According to data from the research company Kpler, which is mentioned in a report by Bloomberg, the measures “against” Russian oil caused a very significant change, mainly in the Asian market. Last April, more than 30% of the crude oil imported by China and India came from three countries that, coincidentally, are on the Western “black list”: Russia, Iran and Venezuela.
The corresponding percentage in February 2022 was 12%. At the same time, the flow of oil from the United States and West African countries to the Asian duo is significant, at 35% and 40% respectively. The reason we mention Iranian and Venezuelan oil with Russian oil is that they are cheaper than others, precisely because of the sanctions. In essence, this means that the two major Asian countries are taking advantage of sanctions imposed by Western countries and buying crude oil at low prices.
In a way, the two biggest oil consumers in Asia have become the forced destination of oil from Russia, Iran and Venezuela. This means that these three countries are now hostages to China and India and are forced to sell oil at below market prices. Based on the data so far, the International Energy Organization (IEA) argues that the measures against Russia have had the desired effect, namely the unimpeded flow of oil with a simultaneous reduction in revenue from the Russian state. The US Treasury Department argues exactly the same.
When it comes to diesel and other refined products, fears that Europe will run out of diesel seem to have been somewhat exaggerated. Data from the company Vortexa processed by Bloomberg shows that flows of refined products to European Union countries and the United Kingdom are these days at the same levels as the 2022 average.
Only this Russian diesel which covered 50% of European imports gave way to shipments from the Middle East, the United States, India and other Asian countries. The conclusion is therefore that, so far at least, the measures taken by the EU. and the G7 team are having some effect and certainly not hurting each other.
Disclaimer
This material is provided for informational purposes only. Under no circumstances should it be considered an offer, advice or solicitation to buy or sell the products mentioned. Although the information contained is based on sources believed to be reliable, no assurance is given as to its completeness or accuracy and should not be relied upon as such.
