Capitalization of Ukrainian agriholdings in Q3 2018

17.10.2018

Capitalization of Ukrainian agriholdings in Q3 2018

The capitalization of Ukrainian agriholdings listed on foreign exchanges generally followed a downward trend in Q3 2018, UkrAgroConsult analysts say.

Having started the quarter at EUR 2.563 Bl and peaked at EUR 2.657 Bl on August 3, the capitalization of the above agriholdings then turned down and hit its low at EUR 2.441 Bl on September 14. It closed the quarter at EUR 2.596 Bl on September 28.

In the third 3rd quarter of last year, the market value of these agriholdings also moved downwards (see diagram on the right), but it was EUR 200-300 Ml higher than in Q3 2018.

This year’s lower capitalization results largely from two factors, which are external to Ukraine. The first one is a decrease in the Warsaw Stock Exchange Index in 2018 compared to last year, though it showed upward movements in both 2017 and 2018.

The other factor is a sinking exchange rate of the Polish currency against the euro. The shares of Ukrainian public agriholdings are listed mostly on the Warsaw and London Stock Exchanges. A weakening Polish zloty against the euro during the comparison periods affected the euro-denominated capitalization of the agriholdings. So, the zloty exchange rate was at roughly PLN 4.35 per EUR in Q3 2018 versus some PLN 4.25 per EUR in Q3 2017.

 

Overall, the exchange rate of the pound against the euro also lowered in the period under review.

The capitalization trend is determined by the market value of major agriholdings, which include MHP, Kernel, Astarta, Ovostar, and IMC. The Q3 developments in their capitalization are presented below.

Based on the initial and final dates of this period, the quarterly gain in the total market capitalization of Ukrainian agriholdings amounted to EUR 33 Ml. Its volatility was contributed to mainly by MHP and Kernel. The market value of the former lost EUR 49.5 Ml, while the latter company’s capitalization increased EUR 84.3 Ml.   

Transferring Mriya Holding to a new owner and an announced restructuring program have not yet influenced the company’s market value.

In the third quarter, UAIndex of the agriholdings fluctuated within the range of 4.3-4.7 points with its maximum registered at 4.7 (August 3) and minimum at 3.17 (September 14).

This year the Index was lower than in Q3 2017 because of the above-mentioned reasons.

 

UkrAgroConsult

 

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