PGNiG pumped up

State-controlled gas monopoly PGNiG enjoyed a bumper bourse debut on Friday. Its stock price began the day at zł.4, or 34 percent higher than the initial public offering (IPO) price, which was massively oversubscribed. The opening price puts the value of PGNiG at about zł.24 billion.

Company officials said earlier this month that subscriptions had reached 16 times the number of shares on offer in the zł.2.7 billion IPO, as interest in the group mounted from both foreign funds and retail investors  alike.

Until now, PGNiG had been the last central European gas company completely in state hands. Fifteen percent of shares debuted last week, leaving the state in control of 85 percent.

Center-right parties expected to win parliamentary elections opposed the sale, arguing that it threatened Poland's energy security, and promising to re-nationalize the PGNiG's stake in a gas transmission pipeline. The current government says that the corporate governance of the pipeline operator gives the state adequate control.

Investors paid little heed to the controversy, allowing PGNiG's IPO price to hit the top end of its planned range. Local banks lent retail investors up to 22 times their original investment to take part in the IPO.

Analysts view the stock as a "must have" for investors in CEE, on the strength of its large market capitalization and expected heavy weightings on major bourse indices. (Reuters)