The fifteen finalists of the Bucharest Stock Exchange's BVB Arena program, dedicated to identifying and promoting successful entrepreneurial companies in our country, will be announced in a few weeks, at the end of a process that lasted several months that included nomination, evaluation and selection stages of issuers.
The platform is dedicated to investors, consultants and, in particular, companies with growth prospects, who want to attract financing from investors or who are in the process of preparing a private placement on the AeRO Market or the BVB Main Market. Thirteen listed companies, twenty-seven bond issues and approximately 270 million euros attracted in financing are the figures for the first eight editions of this program, according to information on the BVB website.
Company nominations are made by the Nominating Committee, entrepreneurs, and the public, and the selection of the 50 semi-finalists is up to the Committee members.
"Romanian companies that have at least 51% resident individuals/legal entities in their shareholder structure are eligible for nomination in the BVB Arena program. Companies with foreign shareholders are exempted, provided that the major operations are in Romania. Respectively, foreign investors are individuals who have established a company in Romania, without it being part/subsidiary of a foreign company. Companies of all sizes can be nominated: start-ups - with a condition of at least three years of activity (having prepared at least three annual financial statements) or turnover, in the last reported year, to be at least equal to 250,000 euros, SMEs, Corporate and from all industries/fields of activity. In addition to these minimum eligibility criteria, when nominating a company, additional criteria are also taken into account regarding the company's performance in terms of profitability, relevant performances from previous years, including launched products or prototypes, as well as innovation prospects on niche markets, including whether the company has had a project/prototype that had the chance to expand widely in the short term”, the BVB Arena team told us.
After the semi-finalist selection stage, the fifteen finalist companies are determined, of which three are designated by public vote, and twelve by the program jury.
• Solid companies in the food, tourism and energy industries
This year's edition of the program includes several solid companies, as well as several others that are clearly on a growth trajectory.
The entire capital market would like to see food producer Cris-Tim in the stock market arena, which in the last two years has exceeded the threshold of one billion lei in turnover and recorded a net profit of almost 90 million lei in 2024. Tour operator Christian Tour is another reference name in the Romanian economy, with business that recently exceeded 600 million lei and with profitability on an upward trend.
The importer and distributor of auto parts AD Auto Total, the provider of solutions and services for the energy industry Cis Gaz, the manufacturer and supplier of electrical equipment EnergoBit, as well as the food company Agricola International are among the solid businesses that, at first glance, seem suitable for the stock market. But not all of the 50 BVB Arena semi-finalists have the necessary characteristics to attract investors.
• Places of issuers that can assert themselves on the capital market, occupied by companies already listed
From the presentation of the program, it follows that its purpose is to attract companies to the capital market, which implies obtaining financing by them through issuance of shares and bonds or the sale of parts of companies to investors. Under these conditions, companies already listed - regardless of their performance - are not suitable for the BVB Arena program.
Arobs Transilvania Software, Bento, Visual Fan, Simtel, TeraPlast and Bittnet Training are among the semi-finalists of this year's program, practically occupying places that could have supported the assertion of new companies on the capital market. The situation becomes even more difficult to understand as the number of companies already present on the capital market and yet nominated in the program has increased compared to previous editions - in 2024 only Automon Services was among the BVB Arena semi-finalists, while in 2023 Ascendia and Grup Şerban Holding were present on the list.
Bittnet Training is a company that is part of the Bittnet Group, whose parent company, Bittnet Systems, has been listed on the BVB since 2015, during which time it also launched numerous bond issues. Moreover, Bittnet Training has been losing money in the last five years, during which time its turnover has also decreased to only 0.15 million lei, after a maximum of only 3.3 million lei, according to data from Termene.ro and Risco.ro.
• Negative equity - the recipe for keeping investors away
Druid AI is presented as an end-to-end enterprise platform based on artificial intelligence that allows for the ultra-fast development and deployment of AI Agents and intelligent applications that automate business processes. The company was founded in 2018 and has been recording increasing losses since then, last year the negative result was 52 million lei. In addition, in the last two years Druid AI reported negative equity of 75.1 million lei and 23.1 million lei, according to Risco.ro data.
Perhaps Druid is an innovative company, which at some point will manage to monetize the solutions it offers much better, but until then it is hard to believe that investors will be attracted to a company that is sinking into losses and its debts exceed its assets.
Another company with negative equity that entered the BVB Arena semi-final is Fepra Pet Recycling, which operates in the circular economy. The company has recorded losses in the last five years and negative equity of 2.6 million lei, according to the aforementioned sources.
• Companies with one employee and an NGO not related to the capital market
Măr de Bran, an apple juice producer, was founded in 2011, and in the last ten years its turnover has stagnated around 0.2 million lei, while the maximum profit achieved in this period was 0.05 million lei. Last year, the company had a net result of 1,759 lei and one employee, according to Risco.ro.
Eematico Research and Noah Watches also had one employee. Eematico is an organization that deals with the development and implementation of STEAM (Science, Technology, Engineering, Arts, Mathematics) learning experiences for children. In the last ten years, the company has not managed to have a turnover higher than 0.26 million lei, while the net result has fluctuated between profits and small losses, the entity ending 2024 with a negative result of 1,282 lei. The watch manufacturer Noah has slightly larger business, around 0.5 million lei and profits of less than 0.2 million lei in the last two years.
To be listed on the AeRO Market, a company must have an anticipated capitalization of at least 0.25 million euros. However, when a company has only one employee and its profits are, at best, limited to one or two hundred thousand lei, such an assessment not only becomes difficult to justify, but also seems completely unrealistic, especially after the disappointments of the past three or four years.
Transylvania College, a British school that offers a complete educational path, from nursery to high school, is in reality a non-profit entity (NGO), without a patrimonial purpose, so it does not qualify as a commercial company. However, the Bucharest Stock Exchange can only list entities with a profit-making purpose, whose objective is to obtain profit, not non-profit organizations!!!
The nomination of such an institution shows either a lack of understanding of capital market rules or an unacceptable superficiality on the part of someone making the selection.
• The same names, edition after edition, while others remain outside
The companies repeatedly nominated in the BVB Arena semi-final also attract attention. If in some cases such a selection may have a justification - such as the example of Apemin Tuşnad, also present at the last edition, but which in the meantime has obtained the highest profit in the last decade - in other situations such choices seem completely unjustified.
The meat and meat products producer Moldovan Carmangerie is in the semi-final of the program for the third time in a row, although in the last two years it reported a net profit of 0.2 million lei and 0.06 million lei, respectively, with tiny margins. The company in the HoReCa sector Salad Box was nominated a few years ago, but is currently recording a loss of 1.2 million lei. Jewelry manufacturer Iona Woman is in the semi-finals for the second time in a row, although it has only four employees, it exceeded the one million lei threshold in turnover only two years ago, and profitability oscillates around 0.2 million lei.
Perhaps these companies will manage to grow in the coming years, but their mere presence once in the semi-finals of the program would have been more than enough. It would be time for other companies to have the opportunity to enter the game.
There would be other examples, but we will stop here.
The BVB Arena jury has already chosen the twelve finalists who, along with the three chosen by the public, will be announced this month and we hope that companies that are truly suitable for the program have been selected - because among the 50 semi-finalists there are enough. And we also hope that some of them will use the mechanisms of the capital market for financing in the near future.
As IT Genetics, one of the finalists of last year's BVB Arena program, is now preparing to do.
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