Central European Media Gains Before Index Revamp: Prague Mover

Central European Media Enterprises Ltd. (CETV) climbed for its fourth week of gains on speculation that a revamp of a benchmark index will boost demand for the stock.

CME, as the television broadcaster is known, increased 0.8 percent to 145.50 koruna, taking its advance to 2.1 percent this week and 31 percent this month.

The number of CME shares included in the CECE Composite Index of major Polish, Czech and Hungarian equities will more than double to 77 million from Sept. 24, according to data from Wiener Boerse AG, which compiles the gauge. The move follows a swap of CME’s bonds into shares that began trading this month.

“CME’s weighting in the index will slightly increase as a result of the higher number of shares being included, which will in turn support demand from funds tracking this index,” Milan Vanicek, chief analyst at J&T Banka AS in Prague, said by phone today. J&T has a buy recommendation for CME with a price estimate for its U.S.-traded shares of $11.

CME’s current weighting in the CECE index is 0.40 percent, according to data compiled by Bloomberg.

To contact the reporter on this story: Krystof Chamonikolas in Prague at kchamonikola@bloomberg.net

To contact the editor responsible for this story: Gavin Serkin at gserkin@bloomberg.net

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