2. Prices
  3. Market segments

Market segments

NewConnect market segments are designed to ensure market transparency and help investors to identify companies on grounds of their financial standing and resulting financial risks.

The new segmentation covers all companies listed on NewConnect, which may be classified into one of the following segments:


Companies are classified to the segments on a quarterly basis, two trading days before the last trading day in March, June, September and December of each year.

Companies classified in the segments have a special designation in the GPW information services and on the website www.newconnect.pl.

The first classification in the NewConnect segments took place on 28 September 2016.

The classification of companies in the NewConnect segments is not a company ranking or GPW’s recommendation to invest or not to invest in the financial instruments of the companies. Investors should make an independent assessment whether they may invest in the financial instruments of a company so classified, and the assessment should at each time include in particular the legal, economic and financial standing of the company.
 

The classification is governed by Resolution No. 646/2016 of the Warsaw Stock Exchange Management Board of 23 June 2016 (as amended)

NC Base Segment

The NewConnect Base segment includes shares of issuers which are not classified in the segments NewConnect Focus and NewConnect Alert, including companies whose shares have been traded on NewConnect for less than 12 months, including all new listings


NC Focus Segment

Criteria of classification in NC Focus

At least five of the following criteria should be met:

  1. average capitalisation of the issuer is more than PLN 12,000,000;
  2. P/E (price/earnings) is more than 0 and less than 50;
  3. P/BV (price/book value) is more than 0 and less than 10;
  4. dividend yield is more than 0 (the company has paid out a dividend);
  5. book value is more than PLN 1,000,000;
  6. increase of revenue in the last four quarters;
  7. increase of net profit in the last four quarters.

Furthermore, companies must meet all of the following criteria:

  • shares traded on NewConnect for more than 12 months;
  • average share price more than PLN 0.10;
  • positive book value of the issuer presented in the most recent published periodic report;
  • no bankruptcy / creditor arrangement / recovery / resolution proceedings pending against the issuer;
  • none of the disciplinary measures under the ATS Rules have been imposed on the issuer more than once in the last 12 months;
  • none of the disciplinary measures under the ATS Rules have been imposed on the issuer in the last three months and trading in the issuer’s shares has not been suspended due to safety of trading participants.

In special cases, even if the criteria and conditions defined in the rules of classification are met, the Exchange Management Board may decide not to classify the shares of an issuer in the NC Focus segment.


NC Alert Segment

An issuer’s shares are classified in the NewConnect Alert segment if at least one of the following criteria is met:

  • average share price of the issuer less than PLN 0.05;
  • negative book value of the issuer;
  • disciplinary measures have been imposed on the issuer more than once in the last 12 months;
  • a petition has been filed or bankruptcy / creditor arrangement / recovery / resolution proceedings are pending or bankruptcy / creditor arrangement has been announced or recovery / resolution proceedings have been opened or the court has rejected a bankruptcy petition because the issuer’s assets are insufficient to cover the costs of the proceedings;
  • the auditor has issued a negative audit opinion on the financial statements or refused to issue an opinion, and the situation has not changed until the date of classification.

Companies classified in the NC Alert segment are removed from index portfolios and moved to the single-price auction system.

Irrespective of the periodic review, if a bankruptcy petition is filed or creditor arrangement, recovery or resolution proceedings are opened, the shares will be classified in the NC Alert segment.

In special cases (e.g., non-compliance or undue compliance with the disclosure obligations, breach of other regulations, suspended trade in shares), the Exchange Management Board may decide to remove shares from the NC Focus or NC Base segment and move them to the NC Base or NC Alert segment, respectively.