Greek Economy May Hit Turning Point in 2011, National P&K Says

Greece’s economy could reach a turning point in 2011 with investment opportunities in the refining, energy and industrial sectors provided it keeps on course with structural reforms and fiscal consolidation, National P&K Securities said.

“The fiscal consolidation program has made a strong start,” the Athens-based brokerage said in an e-mailed report today. “The implementation of the structural measures carries execution risk.”

Greek Prime Minister George Papandreou is implementing reforms to cut the biggest deficit in the European Union’s history which closed at 15.4 percent of gross domestic product last year. The economy is expected to shrink 3 percent in 2011 before returning to growth in 2012.

In industry, Mytilineos Holdings SA is expected to gain from high aluminum prices while companies with “high dependency” on construction such as Halcor SA and Sidenor SA may face a “challenging pricing environment,” according to the report.

Public Power Corp SA, the country’s biggest electricity producer, is expected to remain “dominant” in the energy market with some market share going to other companies including Mytilineos, National P&K said.

Coca-Cola Hellenic Bottling SA and Bank of Cyprus Pcl, helped by their “defensive characteristics,” as well as Hellenic Telecommunications Organization SA, Motor Oil Hellas SA and Metka SA, are the current “Top Picks,” the report said.

National said it’s “positive regarding the gradual uptake of the market” toward the second half of 2011 and expects “relative weakness” in the first half.

International exposure may boost performance of companies including National Bank of Greece SA, the country’s biggest lender, Titan Cement Co SA, Greece’s biggest producer of the building material, and Folli-Follie SA, the report said. In the first nine-months of the year 29 percent of sales at Folli, a Greek jewelry and handbag retailer, came from Japan and other Asian countries.

To contact the reporter on this story: Natalie Weeks in Athens at

To contact the editor responsible for this story: Angela Cullen at

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