Research of the New Connect market enterprises economic situation. Methodology and test revision of suggesting models

Abstract

The new stock market called New Connect began on Warsaw Stock Exchange on 30 August 2007. It is a kind of Polish alternative stock investment market. It was designed first of all for not very large companies, young, innovative, being in preliminary phase of their economic development, but which have large capital needed to finance their growth and investment opportunities. Taking into account the specific economic situation of these enterprises as well as the goals of buying by them the capital on the stock market, it is necessary to find for them correct growth and efficiency ratios, which will present their development degree. The analysis of the economic situation of New Connect companies has to be the alternative method for analyzing their market value, described separately by the stock market index. The measures of growth, development and efficiency of these enterprises have to turn on fundamental financial results of their economic activity. It gives a chance to analyze the companies’ strengths and weaknesses, and their value drivers. The paper presents proposals of several different growth and efficiency ratios for the New Connect Stock Market enterprises. Additionally it shows the proposed construction and the selection of partial variables. The paper also describes the results of the empirical verification of proposed models. On the basis of empirical verification results, the synthetic coefficient of the growth and efficiency analysis is proposed for the New Connect Market companies.economic situation ratio, stock market, New Connect market, synthetic and partial coefficients, growth, efficiency