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Athens Exchange | Reimagining Greek Market

Market activity and outlook remain strong – Trading activity has been strong ytd, with ADV +14% yoy at c€108m, further propelled by a re-pricing of Greek stocks with the average market cap at €74bn (+13% vs the same period last year). Despite a temporary setback in March due to concerns over global financial stability, investor confidence has further strengthened, especially in the aftermath of the election results in May. Besides the stable political landscape – which is likely to be cemented after the 2nd round of general elections on 25th June – there are several other reasons for investors to be sanguine about Greek stocks’ prospects, namely: i) healthy macro, ii) the anticipated return of the sovereign to investment grade status, ii) Greek banks’ improved fundamentals, and iv) the still compelling valuations, especially in the case of non-financials which remain at >25% discount vs EU peers. Additionally, opportunities for the “reinventing” of the Greek market lie in metrics such as MCap/GDP and trading velocity, with Greece remaining a laggard vs other markets. Hence, we expect volumes and MCap to remain on an upward trajectory, further boosted by increased appetite for IPOs and corporate actions. The well-telegraphed potential return to Developed Market status is a potential catalyst, albeit one for the next 2 years and with a less clear read-through in terms of impact, in our view.

Material upgrades on traded value step-up – Given the trends ytd, we now pencil in 2023-24e ADV of €101-136m and average market cap of €78-98bn respectively, assuming velocity ramps up to 35% in 2024e and 36% in 2025e (vs current EU avg of 59%), still corresponding to a MCap/GDP Ratio of