Successful listing of Rompetrol Rafinare breaks down BSE trading system

The interest of investors in the stock of Rompetrol Rafinare (Petromidia Refinery) yesterday caused the trading system of the Bucharest Stock Exchange to break down, in the first day when the company was listed on the capital market.

As the system had not dealt with Buy and Sell orders for billions of shares before, it broke down after only one and a half hours of trading, irritating both brokers and investors.

However, the short operating interval was enough for Rompetrol Rafinare to log transactions in excess of two billion shares, close to the volume traded on the Bucharest Stock Exchange in the entire year 2001 or in six months last year.

The value of transactions involving Rompetrol Rafinare stock revolved around 11 million dollars, whereas the market’s liquidity amounts to an average of two million dollars daily.

“I was expecting this kind of interest from the investors, after a rather long period of time during which the company’s shares were not traded. Also, the company’s results and prospects are very good,” Dinu Patriciu, president and main stockholder of the Rompetrol Group told Ziarul Financiar.

Rompetrol Rafinare (the former Petromidia refinery) was initially listed on the Rasdaq secondary market, but its stock was suspended from trading last November, in order to start the listing procedures on the Bucharest Stock Exchange.

In the past three months, the company has managed to settle its debts to the State and split the shares, from the nominal value of 214,200 ROL to 1,000 ROL/share. The last trading price of the company’s stock on Rasdaq was 75,000 ROL/share, in accordance with the old nominal value.

Investors were expecting the shares to resume trading at prices exceeding 300-400 ROL (for the new face value), with some analysts even estimating a surge to 700-800 ROL/share in the first trading day.

However, following a big transaction concluded at a small price, the trading session opened at 116-200 ROL/share, which led to the emergence of massive Buy orders. Under the pressure of these orders, the trading system broke down.

The computer programme used for trading by the Bucharest Stock Exchange is developed by an Australian company and the Romanian capital market pays several hundred thousand dollars every year for maintenance. Since BSE is not allowed to change the programme’s structure, the management decided, several years ago, to develop its own trading system, dubbed Arena. This programme is now used only for trading securities, although it was also designed to allow for transactions with stock and most brokers were happy with its performance.

Attending the listing ceremony of Rompetrol Rafinare on the Bucharest Stock Exchange, Dinu Patriciu did not disclose many details about the company’s growth plans both on the oil market and on the Bucharest Stock Exchange, because of constraints imposed by the bourse regulations.

“I can tell you that we shall move to increase the liquidity of shares on the stock exchange. The companies included in the Rompetrol Group own residual stakes in Rompetrol Rafinare, which we shall use to this very end,” Patriciu said.
laurentiu.ispir@zf.ro ; vlad.nicolaescu@zf.ro