National Stock Exchange Of Lithuania Monthly Bulletin - January

The beginning of the year was cheering not only because of the abundance of positive news but also because of the lasting interest of investors. The market was supplied with a large inflow of shares obtained as a compensation for the existing real property to be bought out by the state. They were of a particular interest to foreign investors willing to increase their holdings. In January the demand increased 1.5 times, and the demand/supply ratio went down to 1.9. During the month, the price of only 15 shares dropped, and share prices rose by more than one tenth each; the number of transactions exceeded that of December by 3.5 thousand. As usual, shares of Lietuvos Telekomas AB and those of distributional networks were the most popular. Shares of the dairy sector were traded very actively of late: for more than half a year their price was steadily going up, and in January it increased by 15-22 % again. In an anticipation of dividend from the profit of the previous year, shares of Vilniaus Vingis AB and SnaigÎ AB were in great demand. On 22 January, a group of Lithuanian investors paid LTL 88 million to the European Bank of Reconstruction and Development and the East European Food Fund for the 41.1 % stake of Rokiðkio S°ris AB. The total monthly turnover of these shares reached LTL 104 million. The turnover of shares of Lietuvos Telekomas AB, Vakar¯ Skirstomieji Tinklai AB and SnaigÎ AB on the central market exceeded LTL 5 million each. The most active agents in share trading on the central market were financial brokers of Hansabankas, Vilniaus Bankas and Finasta brokerage firm.

In January, the trading volume on the Exchange outdid both the monthly volumes of each month in 2003 and the average quarterly volumes throughout the entire history of the Exchange.

As trading in January was very active, the average monthly value per share transaction increased from LTL 15 to 22 thousand; per T-bill transaction it went up from LTL 826 thousand to LTL 1.4 million. The stability of trading volumes is evidenced by the fact that the share turnover exceeded LTL 3 million during 15 trading sessions, and the total volume was above LTL 10 million. On the central market the growing trend in share trading persisted: the average turnover per session on the central market augmented from LTL 1.2 million (in 2003) to LTL 2.3 million, and the aggregate average of the share turnover per session soared 3.8 times, to LTL 8.7 million. The share indices grew accordingly: LITIN by 13%, LITIN-G by 9%, and LITIN-10 by 8%. With the rise in share prices in general, the capitalisation of the Exchange went up by 6% again and crossed the limit of LTL 19 billion, while the capitalisation of listed shares augmented by 11% jumping over LTL 10 billion.

The share turnover on the central market was analogous to the largest monthly turnovers of the preceding year and amounted to LTL 47.7 million. Yet, that accounted for only as much as 26% of the total share turnover of LTL 183 million. The results of execution of four tender offers excluding, the turnover of other transactions was analogous to the total turnover of transactions in 2003 and accounted for LTL 13.8 million. The share turnover in negotiated deals was one of the largest among the monthly turnovers of negotiated deals throughout the history of the Exchange. It equalled LTL 122 million. To sum up, in January the turnover of both shares and T-bills (LTL 216 million) as well as the total turnover of securities (LTL 399 million) was among the largest in the history of the Exchange. In view of the prevailing positive tendencies the evaluation of the near future prospects inspires optimism.

In February the third phase of the compensation with shares for the existing real property to be bought out by the state will commence, in which individuals will be able to choose between the securities of Lietuvos Telekomas AB and Vakar¯ Skirstomieji Tinklai AB (VST). During this phase, which is to end on 30 June, the remaining 7.93 % of Lietuvos Telekomas AB shares in the value of LTL 109.858 million and 0.26 % of the VST shares in the value of LTL 1.581 million will be distributed. The share price of Lietuvos Telekomas AB to be allocated for the compensation was fixed at LTL 1.70, and that of the VST - at LTL 1.50, i.e. by 30 cents more than in the second phase of the compensation. The Government has extended the period during which people will be able to receive the compensation in corporate shares for the real property to be bought out by the state for one more year (until the end of June 2005). It is highly probable that most of these shares will be traded on the Exchange.

The consortium of the Lithuanian investors has filed an application to register a tender offer to buy up all the remaining shares of Rokiðkio S°ris AB at the price of LTL 45.1. The value of the company at this price is LTL 214.1 million.

In February the privatisation tender for the Exchange and the Depository has been launched. The set of privatisation documents has been already acquired by OMHEX, the operator of the North European stock exchanges. The Warsaw Stock Exchange is another serious candidate to participate in the tender.