Upward trend on the BVB; investors looked beyond fiscal pressures

The indices of the Bucharest Stock Exchange (BVB) entered a strong upward trend in the second part of last year, after the outcome of the presidential elections in May confirmed the country's pro-European trajectory. The BET index, which tracks the twenty most liquid stocks on the local market, recorded a gain of 30.4% between July and December 2025, reaching new all-time highs, while the BET-BK index, the performance benchmark for equity investment funds, advanced by 36.9%.

Rating agencies maintained the country's "investment-grade” status, albeit with a negative outlook, reflecting at the time both the improvement in economic prospects and the risks related to the implementation of the Government's fiscal consolidation plan aimed at reducing deficits.

Inflation rose sharply following the liberalization of the energy market, reaching 9.7-9.8% in the latter part of the year, while forecasts for economic growth were revised downward, outlining a rather stagflationary picture for Romania in the short and even medium term. However, share prices on the BVB increased significantly, which may suggest that investors adopted longer investment horizons and sought protection against inflation. In addition, the stability of the exchange rate in the second half of the year and the gradual decline in the interest rates at which the state borrows likely boosted confidence in Romanian financial assets, supporting stock market performance.

• The easing of monetary policy, expectations regarding the impact of artificial intelligence, and corporate earnings fueled the rally on the United States market last autumn

Stock market indices in the United States posted gains in the autumn of last year, following an easing of trade tensions, supported by capital flows into risk assets and by the relaxation of monetary policy in the United States. Expectations related to major investments in artificial intelligence and the productivity gains the technology is expected to deliver were among the main drivers of the US equity rally, alongside better-than-expected results reported by most companies in the S&P 500 index. However, in the final months of the year, the share prices of leading US-listed companies entered a consolidation phase, amid concerns over whether the massive capital investments required for the infrastructure underpinning artificial intelligence applications can be justified in terms of profitability potential.

The S&P 500 index rose by 10.3% between July and December 2025, while the Dow Jones index gained 9%. The Nasdaq Composite index, which tracks companies operating in knowledge-intensive sectors and is more sensitive to interest rate changes, advanced by 14.1%.

On our side of the Atlantic, where the European Central Bank left interest rates unchanged and there is currently no clear commitment to further cuts, and as the European Union reached a trade agreement with the United States, the Stoxx 600 index gained 9.5%. Germany's DAX index rose by 2.4%, while the FTSE index recorded an advance of 13.4% in the second half of last year.

• The authorities increased the taxation of gains from stock market investments

On the Bucharest Stock Exchange, companies released their financial results for the second and third quarters of last year, which were largely in line with expectations.

On the other hand, the impact of the fiscal measures adopted by the Government is expected to be felt more strongly in this year's results. Among the measures with a direct or indirect impact on companies, investors, and the capital market as a whole are the increase in fuel excise duties, the hike in VAT rates to 11% and 21%, the additional taxation of banks' turnover-except for those with a very small market share-the increase in the dividend tax from 10% to 16%, and the rise in the taxation of gains from stock market transactions, from 1% to 3% for gains realized over a period longer than one year, and from 3% to 6% for gains realized over a period of less than one year.

• Transgaz and Electrica shares posted the largest gains within the BET index

Transgaz shares surged by 92.1% in the second half of the year, continuing a strong upward trend developed in 2025, as the company reported very solid financial results throughout the year. In addition, there are growth prospects driven by European Union countries' move away from Russian gas and the start of natural gas production in the Black Sea.

Electrica shares also followed a pronounced upward trend, appreciating by 79.2% in the second half of last year. The company benefits from a favorable environment following the liberalization of the electricity market, reported excellent financial results, and intends to secure financing for acquisitions of up to one billion euros, targeting companies, assets, or business lines in the energy sector, both domestically and in other European Union member states. In line with the performance of utility companies' shares, Transelectrica stock gained 31.6% in the second half of last year, even though the company reported a loss for the July-September 2025 period. The issuer announced a 10% increase in tariffs starting this year, a development that should be reflected in improved profitability.

Shares of energy producer and supplier Hidroelectrica entered a consolidation phase in the second half of last year, as the company's profit declined in the second and third quarters due to higher volumes of electricity purchased and lower energy production caused by unfavorable hydrological conditions, which partially eroded the cost advantage of its own generation. Nuclearelectrica shares rose by 32.6% in the second half of last year, with the increase becoming more pronounced in the final three months, after the company reported a significant improvement in profitability. The Ministry of Energy requested that the approval of the final investment decision for the Small Modular Reactors (SMR) project be included on the agenda of this month's shareholders' meeting.

• Rally in Premier Energy shares in the final part of the year; strong gains for OMV Petrom and Romgaz stocks

Shares of oil and gas producer OMV Petrom advanced by 32.1% in the second half of last year, a period during which the company also distributed additional dividends. Regarding the Neptun Deep project, which is estimated to supply up to 100 billion cubic meters of natural gas, the company announced progress in line with the plan, with first gas expected to be extracted next year. Romgaz shares, those of OMV Petrom's partner in the Neptun Deep project, rose by 42.5% in the second half of last year. The issuer may benefit from the sanctions imposed by the United States on Russian energy companies and is targeting entry into the natural gas supply market for household and small non-household customers in April, alongside market liberalization, according to the press.

Shares of energy infrastructure company Premier Energy gained 45.5% in the second half of last year, with the issuer's share price entering a strong upward trend in recent months after a period of stagnation lasting more than two years. The moves occurred on high trading volumes, suggesting steady purchases by large-scale investors. The company reported a sharp increase in profit for the third quarter of last year, and market expectations are for the issuer to deliver strong results for the fourth quarter as well, given that, according to analysts' reports, during the earnings call management hinted at outperforming the 2025 budget and delivering better-than-expected results.

• Gain of over 50% for MedLife; announcements regarding potential corporate transactions in Spain fueled the rise in Digi shares

Banks included in the BET index and listed on the Bucharest Stock Exchange posted gains of varying magnitude in the second half of last year, a period during which the European Euro Stoxx Banks index advanced by 31%. Banca Transilvania shares rose by around 16% over the period, a performance that also includes the ex-dividend correction related to the additional dividend allocation in December, while BRD-Groupe Societe Generale shares recorded a gain of 37.2%, in the absence of any concrete information to justify the move.

Private healthcare services provider MedLife surpassed a market capitalization of one billion euros in December 2025, marking a 53.4% increase in its share price in the second half of the year. MedLife, one of the growth issuers on the BVB, reported a profit for the third quarter, after having posted losses in the first two quarters of 2025, while the interest rate cuts expected in the second half of this year should be beneficial for the company, which has a high level of indebtedness.

Shares of telecommunications operator Digi Communications, which rose by 47.9% in the second half of last year, were driven by press reports regarding the possible listing of its Spanish subsidiary on the Madrid stock exchange at a valuation of around 2.5 billion euros, as well as by speculation that Telefonica could acquire the Digi group for approximately 3.8 billion euros-figures above the company's market valuation in Romania at the end of last year.

Shares of real estate developer One United Properties entered a recovery phase from the downward trend that had developed throughout last year and into the first part of this year, with the share price rising by 36.2% between July and December 2025. The company reported higher revenues and profit for the first nine months of last year, will launch a public buyback offer for up to 20% of its share capital at a price range between 25 and 40 lei per share-above the pre-announcement market price-and continues to acquire land in Bucharest and across the country for real estate developments. In addition, shareholders approved the sale of the One Tower building for at least 114 million euros, a transaction that would turn the Floreasca-area property into the most expensive office building in Romania.

Shares of Danube freight transporter and port operator Transport Trade Services advanced by 21.1% between July and December 2025, after the company announced a return to profitability in the third quarter of last year, driven by higher revenues and lower expenses, allowing the issuer to recover a significant part of the loss recorded by mid-2025.

• The Bucharest Stock Exchange participated with 15.3 million lei in a new capital increase of CCP.RO Bucharest

In November, the Bucharest Stock Exchange celebrated 30 years since its re-establishment in 1995, a period during which it achieved several important milestones, such as its promotion to emerging market status in the FTSE Russell classification and the completion of the largest public offering in Europe in 2023, with the listing of Hidroelectrica.

On the other hand, market liquidity remains low and the range of investment instruments is still limited, given the absence of financial derivative products. The Central Counterparty project-an entity required for the relaunch of derivatives-has already recorded a five-year delay. The BVB participated with an additional 15.3 million lei in a new capital increase of CCP.RO Bucharest, after the exchange's shareholders had previously approved a capital increase of the market operator, with funds earmarked, among other purposes, for participation in the CCP's capital increase.

• Trading discounts ranging from 67% for Infinity Capital to 34% in the case of Evergent Investments

The BET-FI index, made up of the former SIFs plus Fondul Proprietatea (FP), rose by nearly 49% to 90,620 points in the second half of last year, as all its constituent stocks posted gains.

A group of retail investors, together with three funds from Slovenia and, most likely, other institutional investors-as suggested by the size of the voting blocks-decided to resume the process of selecting the manager of Fondul Proprietatea and to revoke the four members of FP's Nominee Committee, while the mandate of Franklin Templeton was temporarily extended.

Istvan Sarkany, Matej Rigenlik, Andrei Octav Moise, and Florian Munteanu were elected as members of the FP Shareholders' Nominee Committee at a shareholders' meeting in which the Ministry of Finance-the fund's largest shareholder-failed to impose any of its candidates. The new FP board launched a new selection process for the fund manager in January this year, under the terms approved at the General Shareholders' Meeting in September 2025, one of which requires the selected entity to manage assets at least equal to the value of FP's assets.

The Ministry of Transport rejected the resumption of the process to select the financial auditor of Bucharest Airports, whose responsibilities also included preparing the company's listing on the BVB. Subsequently, at the beginning of January this year, the ministry approved the intention to buy back the minority stake held by Fondul Proprietatea in the company, with a similar intention expressed regarding FP's stake in the Port of Constanţa Administration.

The Ministry of Finance has requested that the agenda of FP's shareholders' meeting scheduled for February 26 be supplemented with an item regarding the appointment of Franklin Templeton as the fund's manager for a one-year term, from April 1, 2026 to April 1, 2027, instead of four years, as proposed by the board, as well as the removal of two members of the Representatives' Committee. The Ministry argues that Istvan Sarkany and Florian Munteanu (the two board members whose removal has been proposed), by putting forward a proposal to grant Franklin Templeton a new four-year mandate as fund manager, failed to comply with the shareholders' resolution adopted in September last year regarding the initiation, by the Representatives' Committee, of a new, simplified, transparent, and efficient selection process for the fund's manager.

At the end of this month, the fund's shareholders have been convened for two general meetings. Items on the agenda include granting a new mandate to the manager Franklin Templeton, consolidating the nominal value of Fondul Proprietatea shares, electing a member of the Representatives' Committee, presenting the results of the consultation process conducted with shareholders regarding the desired strategic direction for the fund, and incorporating the conclusions of this process into FP's Investment Policy Statement. The fund has also received a request to supplement the agenda with items related to the valuation of its holding in the Bucharest Airports company and the return of capital to investors.

In January 2026, Lion Capital launched a purchase offer for 191.6 million shares of Fondul Proprietatea, equivalent to nearly 6% of FP's share capital, at a unit price of 0.68 lei, with subscriptions reaching almost 50% of the total shares offered.

Evergent Investments, whose shares rose by 83.4% in the second half of last year, will grant an additional dividend of 0.135 lei per share from reserves related to profits from previous years, equivalent to a net yield of 4.1% compared with the share price at the end of 2025.

At the end of December, the former SIFs were trading at discounts between market price and Net Asset Value per Share (NAV), ranging from 67% in the case of Infinity Capital to 34% for Evergent Investments. For Fondul Proprietatea, the discount stood at 32%, above the target set by its manager, Franklin Templeton, which aims for a level below 15%.

• Cris-Tim Family Holding ends the year with a market valuation of 1.5 billion lei, following a heavily oversubscribed IPO

The Ministry of Public Finance raised 10.4 billion lei through the six Fidelis government bond offerings carried out in the second half of 2025, a year in which retail investors lent the state 21 billion lei through this program, equivalent to 8% of Romania's financing needs for last year.

Shares of processed meat and ready-meals producer Cris-Tim Family Holding debuted on the Bucharest Stock Exchange on November 26, 2025, following an initial public offering worth 454.3 million lei, whose retail tranche was heavily oversubscribed. Most of the funds raised are to be used to finance the company's development plans. From the issuer's market debut until the end of last year, the Cris-Tim share price rose by 5.9% to 18.5 lei, corresponding to a market capitalization of 1.49 billion lei.

Shares of Grup EM, a group of companies specialized in construction and installation services for the energy sector, were listed on the AeRO Market of the Bucharest Stock Exchange, after the issuer carried out an initial public offering in October through which it sold 38% of the total shares offered. At the time of its stock market debut, in the second half of December last year, the company had a free float of only 4%, but announced a concrete, phased plan to reach the minimum free-float threshold of 10% required to remain listed on this market segment.

Banca Transilvania listed an issue of sustainable bonds in the second half of last year, worth 1.5 billion lei, with a maturity in 2032 and an annual interest rate of 8.875%. In the final part of the year, Banca Comercială Română listed two bond issues on the Regulated Market of the BVB, with total values of 1.12 billion lei and 500 million euros, respectively, and maturities of six years. The interest rate on the 1.12 billion lei issue is 7.718% per year, while for the 500 million euro bonds the interest rate is 4% per year for the first five years, with the final year carrying a variable rate calculated as an annualized rate (three-month Euribor plus a fixed margin of 1.65%), with quarterly payments.

• Electrica and Romgaz listed bonds on the Bucharest Stock Exchange

Energy supplier and distributor Electrica listed its first bond issue on the Bucharest Stock Exchange in the second half of last year, also marking the largest corporate and non-financial green bond issuance in the history of Romania's capital market. The total value of the issue amounts to 500 million euros, with the bonds carrying a fixed annual interest rate of 4.375% and maturing on July 14, 2030.

In December last year, Romgaz listed its second bond issue on the Bucharest Stock Exchange, worth 500 million euros, with a six-year maturity and a fixed interest rate of 4.625%. The issue is part of Romgaz's Euro Medium Term Notes program, with a total value of up to 1.5 billion euros, and the funds are to be used mainly for the company's investment projects.

OMRO, the lending company of fintech Filbo, listed bonds worth 12.3 million lei on the Multilateral Trading System of the Bucharest Stock Exchange in the third quarter of last year. The bonds mature in 2028 and carry a variable interest rate calculated as the sum of the National Bank of Romania's reference rate and a fixed margin of 5.5%.

In October 2025, real estate company Nusco Imobiliara, part of the Italian group Nusco S.p.A., listed its first bond issue on the Multilateral Trading System of the Bucharest Stock Exchange. The bonds, with a total value of 25 million lei, carry an annual interest rate of 9%, mature in August 2028, and have a nominal value of 100 lei per unit.

Read Shock therapy for fiscal-budgetary consolidation