(Finance) – On the one hand the continuation of integration within Euronextfor the extraction of synergies and a bidirectional enrichment between Piazza Affari and the other stock exchanges of the group, on the other the increase in pressure on the authorities and the presentation of new proposals to encourage the development of the stock market, with the aim of bridging the gap towards other European markets and solving the problems of small-midcaps. These were the two focuses of the action of Italian stock exchange in 2023the year of the misalignment between the performances of large caps and SMEs and of the liquidity crisis on the market, but also of a good relative performance of Milan compared to other financial centers in terms of IPOs.
The FTSE MIBdriven above all by the banks that have a greater weight in the Italian blue chip index and have benefited from the powerful rate hike by the ECB, is preparing to close the year with a +28%, while the index STAR lagged behind (+2% YTD) and the index Growth of SMEs was even decreasing (-12%).
“For the small and medium-sized enterprisesthere was a misalignment of the planetsdue to several factors – he tells Finance Fabrizio Testa, CEO of Borsa Italiana – In particular, the first expiry of the PIRs, which after five years offered the possibility of disinvesting while benefiting from tax advantages, generated an outflow of approximately 2 billion euros from the market, mainly affecting SMEs. Furthermore, there has been a reorganization of portfolios, with a significant shift from equity to bonds. This phenomenon also clearly emerged from the robust performance of government bonds intended for retail issued by the Treasury. Those who exited the PIRs or who found themselves in possession of savings preferred to move towards coupons even higher than 4%, resulting in a notable boost in the bond sector to the detriment of the equity sector”.
However, Testa underlines that the problems do not concern the health of small listed companies and wants to be optimistic about their recovery in 2024: “As difficult as it is to make predictions, if we look at the strong performance of blue-chips, we could imagine a realignment of the levels of listed SMEs to that of larger companies. Looking at the excellent numbers of many of these companies, the market agrees that small and mid cap stocks are still there underestimated“.
A positive figure is that of freshmen. Also counting the companies that have submitted the pre-admission application and which will probably land on Piazza Affari by 31 December, 2023 will end with 34 quotes on Euronext Growth Milan (of which 1 Business Combination with a SPAC by Sicily by Car and 4 on the Professional Segment) e 5 quotes on Euronext Milanas well as 5 companies that moved from the EGM to the main list during the year (Technoprobe, Digital Value, Unidata, Cy4Gate And Comer Industries).
“It was a good year for prices, with August seeing 9 admissions in the first days of the month, in contrast to the rest of Europe – says Testa – In September we saw a slowdown, but now we are in the middle of a rush final. What we see is that as soon as there are windows of opportunity companies enter easilybecause they are accompanied, monitored and kept warmso maybe some of those who would have been ready are now looking at 2024, so the question is not whether they will go public but when they will go public, so It gives us hope for next year“.
This year’s success, he adds, “is due to teamwork involving intermediaries, advisors and my colleagues who carry out activities in the area. medium-long term pipeline is also being built thanks to the success of the pre-IPO programs and ELITE which brings together new generations of entrepreneurs, more open to considering the market as a tool for financing growth. And another interesting thing this year is that – of the 10 new issuers on the main list – 5 were transferred from the EGM, which is exactly what we expect because Growth can be a training ground for then moving to the main list “.
In the meantime, the events continued in Piazza Affari delisting, a phenomenon that has increasingly established itself in recent years, not only in Italy. This year there were 24 delistings, of which 4 from Euronext Milan, 4 from Euronext STAR Milan, 15 from Euronext Growth Milan and 1 from Euronext Growth Milan – Professional Segment. There lost capitalization overall it was 11.2 billion euros, on which the 4.4 billion euros weigh Covivio and 2.4 of BB Biotech (both dual listing with Milan which was not the main market), and the 2.7 of Autogrill, to which almost 15 billion will be added CNH Industrial who will leave at the end of the year. CNH will remain listed only on the NYSE, which in recent years has also been the choice of other large Italian groups such as Zegna And Stevanato.
However, the CEO of the Stock Exchange does not say he is too worried about the loss of appeal of the Milanese market: “There are two reasons why we believe that Italy continues to be attractive: everything that is linked to Made in Italy – which is not just fashion or Food & Beverage but extends to a vast range of sectors – obviously sees the Milan Stock Exchange as a candidate to best express itself and a showcase for this type of company; then there is the aspect of being part of the Euronext group, given that with the migration of the stock markets within the Optiq platform, it is a gateway to enter the largest European liquidity pool. This not only offers opportunities for companies listed in Italy but also allows investors from other geographies to access Italian assets. L’integration could facilitate the raising of capital from international investors. You can remain listed in Italy but attract capital from other countries; it is a path in progress, because we have just integrated, but we are seeing in the various IPOs that investors who were not interested before are now starting to look at these books“.
Meanwhile, the ecosystem is moving to improve the health of the Italian capital markets. After Capital Bill, a zero-cost intervention for public finances which focused more on the issues of multiple/major voting and the Board of Directors list, operators have returned to asking for more incisive measures to revitalize Piazza Affari. In the last month the Manifesto for the development of Capital Markets in Italya document prepared by Borsa Italiana, Equita and Bocconi University – and then signed by dozens of operators – containing a series of requests on multiple fronts (investors, intermediaries, supervision, taxation).
“The great focus is on how to channel funds from institutional investorsbut also retail, in the real economy – says Testa – In Italy, investments in the real economy by institutions are around 10%, below the 20% that is observed in France, Holland, Germany, and far from the 40% of the Scandinavian countries, so there is a lot of space and a minimal effort made by large banking, insurance and social security groups would bring new life to the entire Italian industrial fabric, which remains very active and is currently struggling to find investments because historically it has relied heavily on bank credit and now there are high rates “.
Beyond the long list of suggestions, what emerges is also a unanimous voice among market operators, who agree on most issues. “This unity of purpose among market operators is a continuation of the work carried out for over two years, first with the Treasury task force and then with the Green Book, from which some suggestions were extracted and included in the capital bill – says the manager – Now with the Manifesto we wanted to keep attention high and relaunch some themes that emerged in the Green Book but which have not been fully incorporated into the Capital Bill. Many of these issues could however be touched upon in the revision of the TUF.”
Finally, Testa expresses satisfaction with the tight roadmap carried out at the level of the Italian Stock Exchange and the Euronext group this year: “From a strategic and operational point of view, the two most important events of the year were the migration of the Borsa Italiana markets to the Euronext Optiq trading platform el’expansion of Euronext Clearing to all markets managed by Euronext. At the same time, we have conducted other important initiatives on various fronts: in the context of certificates, we have introduced solutions aimed at making access to this sector more accessible to less experienced investors; in bonds, we supported Treasury issues and launched the MTS EU segment which includes issues from the European Commission, including Next Generation bonds, which is enjoying considerable success in terms of activity and transparency. Furthermore, in the field of MTFs, we have relaunched GEM, originally born on the Italian Stock Exchange and now consolidated as a European platform that allows access to shares not listed on the Euronext markets, with particular focus on US companies”.