Fondul Proprietatea – Hidroelectrica’s union is contesting several GSM resolutions
The manager of Fondul Proprietatea (FP) has informed that Hidroelectrica’s employees union is contesting in the law the validity of several GSM resolutions approved by shareholders on April 25, 2012 and November 23, 2012. The said resolutions refer to, among others, the ratification and re-adoption of the legal acts performed by the manager (i.e. the re-approval of all GSM resolutions since September 2010). Therefore, Hidroelectrica’s union is asking in the Court similar issues to some asked by Mrs. Sfiraila. We do not believe that this piece of news will have a material impact on FP’s shares since we do not consider that the union is entitled to contest such resolutions. We remind that Mrs. Sfiraiala is at least a shareholder of the fund.
Pharmaceutical market tempered its growth rate in 4Q 2012
According to research company Cegedim, during 4Q 2012, the pharmaceutical market was up 4% yoy to RON 3.1 bn, a slower growth pace compared to the last quarters (i.e. +5.2% qoq growth rate in 3Q 12). Drugs without prescription (OTC) increased faster qoq (+7.6%) than those with prescription (+4.5%), negatively influenced by the claw-back tax. Over 2012, the local pharmaceutical market increased by 8.3% yoy to RON 11.7 bn, with OTC drugs up 12% yoy to RON 1.6 bn and prescription drugs (Rx) up 7% yoy to RON 8.4 bn. In volume terms the market increased by 4.4% yoy. For 2013, Cegedim’s forecast is bleak pointing to an yoy increase of the market of just 1.4% in RON terms, Rx drugs being negatively influenced by the claw-back tax.
We view the news as rather neutral for Biofarm (BIO) as the company is mainly focused on the production of cheap OTC generics, generally sheltered from legislative headwinds.
