Market Comment - In the Spotlight...

Market Comment

Press reports that state interest from hedge funds about domestic banking sector and the potential of participation in the recapitalisation process kept the bullish momentum (+2.98%) and market activity high (€105m). Most bank stocks ended the session near day highs while bullish sentiment was spread across the board. Positive news from Eurogroup, banking sector momentum and activity in the privatisation front will keep session’s interest high. Although a positive opening is expected we would see profit taking in the course of the day and thus a more volatile session.

In the Spotlight

Greece/ Eurogroup: The Eurogroup has been informed on the outcome of the second review mission under the second macroeconomic adjustment programme for Greece and agreed to disburse two tranches as Greece is seen to be made good progress with implementing the required prior actions for the next disbursement.

The Eurogroup concludes that the necessary elements are in place for Member States to finalise the relevant national procedures required for the approval of the next EFSF instalment, which amounts to EUR 7.5 bn. The disbursement will take place in two sub-tranches. A first sub-tranche of EUR 4.2 bn will be approved by the EWG and the EFSF Board of Directors in the following days, following the completion of the national procedures and the full implementation of the prior actions. The disbursement of the second sub-tranche will be made in June 2013, linked to the implementation of the MoU milestones as agreed between Greece and the Troika.

Cyprus: Cyprus received its first emergency aid payment and Greece won approval of 7.5 billion euros of rescue loans. Cyprus received 2 billion euros today and will get as much as 1 billion euros more in June. The release came as finance ministers from the 17 euro countries wrangled over banking policy and economic remedies to the fallout from the financial crisis that emerged in Greece in 2009.

Greece/ Construction: Building activity in Greece suffered another sharp drop in February with the number of permits issued down 45.4 percent on a year earlier and the volume of construction in the private sector falling 44.8 percent.

Greece/ Privatisations: The process for the submission of expressions of interest in the tender concerning the privatization of regional airports has been extended by 14 days, with the state privatization fund (TAIPED) attributing the delay to the interested parties’ need of additional clarifications. The extension, to May 31, concerns two groups of regional airports that will be conceded for 30-35 years while the contractors will have to make infrastructure investments in the terminals amounting to 200-220 million euros in the next three years.

Titan (Results 3M 2013): Titan is scheduled to announce its first quarter results today, after market close. Market consensus expects turnover to reach €233.2m (+3.5%) on lower margins which is attributed to Egypt deceleration and lack of any CO2 emission rights income (Q1:2012 €10m). On the other hand exports are seen increasing while demand in US is starting to recover at slow pace. Overall bottom line estimates expect negative figure of c€24m. A conference call will follow at 18:00 (GR) after the results announcement.

Titan	Results Estimates Q1 2013
In thous. Euro	2012	2013	Δ
Sales	225,379	233,233	3.5%
EBITDA	34,074	25,100	-26.3%
(% of sales)	15.12%	10.76%	-436 bps
Net Income	-19,409	-24,331	-25.4%
(% of sales)	-8.61%	-10.43%	-182 bps

Bank of Piraeus: Piraeus Bank said on Monday it plans to buy back 321 million euros of hybrid bonds as part of efforts to boost its capital base. Piraeus said that Barclays, BNP Paribas and Deutsche Bank would manage its buyback offer, which aims to boost its Core Tier 1 capital adequacy ratio by up to 156 million euros. The offer is expected to run until May 24.

METKA/Mytilineos: Mytilineos group announced on Monday that it is in advanced talks with Chinese state construction company SEPCO for the joint undertaking of a $1.05 billion project in Iraq. Group subsidiary METKA has already received a formal concession letter from the Electricity Ministry of Iraq for the construction of a combined cycle electricity production station in the province of Al-Anbar, western Iraq.