Top 100 most valuable companies in Romania

In times of crisis it is natural for the value of companies, brands, organisations, individuals, and even states to be verified.

The reallocation of resources can take place slowly, over cycles of ten to twenty years, or abruptly, as is the case now. So what does the crisis amount to - an abrupt decline in stock prices, a decrease in car sales and house prices, or a quick reallocation of resources?

People and companies can change their priorities at short notice, sometimes depending on the others' priorities and not necessarily their own, or can seek to take shelter and sell, whilst prices continue to fall.

How about value, does this also drop? If a manager takes over a loss making company, but restructures it, turns it around and stocks go up, then the company's value is suddenly restored. As a result, no company has an intrinsic value - the context, the deals, the willingness to buy and sell, as well as timing, and the direction the company is headed are also decisive factors.

However, a price benchmark is also necessary. All the more so this year in the wake of a global meltdown, which includes the Wall Street investment banks that set the original values of companies.

Maybe this is where the key of the troubles lies - allowing investment banks to trade on the Stock Exchange, either for self interest, or for their customers', whilst, at the same time, evaluating companies for floatation and researching reports for clients or the public.

How thick was the wall dividing the research department, which rated certain shares as "BUY", and the sales department, where the brokers were prepared to sell?

Who should set the correct value of a share for a third party, whilst they are involved via a different department in the sale or buying process? It remains a very difficult question to answer.

However, it is a question that stands not only for investment banks, but also commercial banks that have research departments, as well as dealings on the Stock Exchange.
Since it is sellers that generate the money, how independent can a "researcher" remain? This is why a ranking of valuable companies will always incite debate.

In its third edition, the "Topul celor mai valoroase 100 companii din Romania" ("Top 100 Most Valuable Companies in Romania"), does not try to present a picture of value, but rather of trends; of the position of domestic companies, either private or state-owned, in terms of their ability to generate future profit and value for shareholders.

The biggest challenge will remain, as before, verifying these values in real life. The deals at the beginning of the year, until the "freeze", were used as a parameter to decide on the ranking. The ranking was put together using data from the Trade Registry for 2007, but the multiples considered were adjusted to the October 2008 level.

The top five companies in terms of value are Petrom (energy), 4,892 million euros, Orange Romania (IT&C), 4,600 million euros, Vodafone Romania (IT&C), 4,050 million euros, Romgaz (energy), 3,700 million euros and Hidroelectrica (energy), 3,600 million euros.