March 29 (SeeNews) - The financial difficulties experienced by Croatian concern Agrokor have impacted the performance of the domestic stock market as investors fear future developments in the company, an analyst at the local unit of Erste Bank told SeeNews on Wednesday.
"The shares of Agrokor's subsidiaries mostly have born the consequences, but the negative sentiment has spilled over to the rest of the market, especially on key suppliers", Davor Spoljara said in response to a SeeNews inquiry.
The 25-share benchmark CROBEX index of the Zagreb Stock Exchange fell sharply in morning trade on Wednesday, pulled down by trade in members of troubled Agrokor.
CROBEX stood at 1,996.56 points by 11:47 CET, down 3.88% from Tuesday's close, ZSE data showed. At the same time, CROBEX10 fell 3.42% to 1,147.96 points. It closed 0.81% weaker a day earlier.
At 15:52, CROBEX recovered slightly to 2,019.64 points, down 2.77% from Tuesday's close, while CROBEX10 edged up to 1,157.67 points, a loss of 2.61%.
"Investors are concerned over the impact future events in Agrokor may have on the Croatian economy and the key companies exposed to the concern," Spoljara noted.
Agrokor members were among the most traded companies in morning trade.
Water bottling company Jamnica [ZSE:JMNC-R-A] generated a turnover of 4.1 million kuna ($594,700/551,100 euro) at 11:47. Its shares shed 17% of their price to 100,000.00 kuna.
Another Agrokor concern member, ice cream and frozen food producer Ledo [ZSE:LEDO-R-A], followed with a turnover of 3.9 million kuna, as its share price plummeted 13.42% to 6,000.00.
By 15:52, Jamnica's turnover climbed to 5.9 million kuna, while Ledo surpassed it with 9.1 million kuna. Jamnica's share price fell further to 99,999.00 kuna, while Ledo's recovered slightly to 6,288.00
Local media are speculating that Agrokor's financial troubles have hit the Zagreb Stock Exchange as panic grips investors.
Agrokor's financial issues became apparent earlier this year when Moody's downgraded it's corporate family rating (CFR) to B3 from B2. The company then pulled out of a syndicated loan deal it had struck with several international lenders, which sent the price of its bonds on international markets into a downward spiral.
Since then, there has been talk of Russian banks, including Sberbank, acquiring a stake in the company and launching an overhaul. Agrokor has neither denied nor confirmed the reports, but it has announced it is working on a new business model to save the company.
(1 euro= 7.43896 kuna)