10 years of NewConnect trading platform
NewConnect, an alternative trading system, celebrates its 10th year of existence. The platform was launched by Warsaw Stock Exchange on 30 August 2007. From the beginning, it was intended as a place for young, dynamic, innovative small and medium-sized enterprises that with time would decide to move up to the main market of Warsaw Stock Exchange. One of the inspirations for creating an alternative market in Poland was the success of American Nasdaq.
NewConnect is a stock trading platform which is organised but unregulated. It is managed by Warsaw Stock Exchange (Giełda Papierów Wartościowych w Warszawie SA). IPO requirements on NewConnect are more liberal than those applying to Warsaw Stock Exchange’s main market. The companies listed on NewConnect often belong to such sectors as IT, telecommunications communications, biotechnology, or alternative energy.
Today, there are over 400 companies listed on NewConnect (including 7 foreign entities), with total capitalisation exceeding 10,085 million PLN. In the category of alternative trading platforms, Polish NewConnect is one of the biggest such institutions in Europe. NCIndex is a market index covering all companies listed on NewConnect market. The trading platform offers higher return on investment but also higher risk than the regulated market.
In the ten years of existence of NewConnect, 59 companies moved to Warsaw Stock Exchange’s main market. 77% of the trade is generated by private investors. Entering NewConnect means lower IPO and SPO costs (in comparison with the main exchange market) and gaining prestige. Since 2007, market participants have acquired investment in the amount of 4.7 billion PLN. “NewConnect has been very successful as an important source of financing for hundreds of companies, mainly SMEs which play a key role in the Polish and European economy.” – noted Michał Cieciórski from Warsaw Stock Exchange SA’s management board.
From the beginning of 2017, ten companies debuted on NewConnect. Last year, seven enterprises decided to move from NewConnect to the main market. By the end of 2016, the biggest listed company on NewConnect, Unimot, was worth over half a billion PLN.