The stock market year 2022 started with a flop in Italy: Investors in Milan lowered their thumbs on Monday over the spin-off of the Italian commercial vehicle manufacturer Iveco.

Both the shares of the newcomer Iveco and the parent company CNH Industrial slipped deeply into the red on the first day of trading.

The Agnelli family of Italian industrialists, who control both companies through their Exor Holding, want to sharpen Iveco's profile as a supplier of “on highway” vehicles by separating them.

In the future, the Iveco Group will concentrate on commercial and special vehicles as well as buses and drive trains.

CNH, on the other hand, now only deals with vehicles for the agricultural and construction sectors.

Christian Schubert

Economic correspondent for Italy and Greece.

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Investors approved the project last year.

Therefore, at the end of the year, CNH was quoted at an all-time high of a good 17 euros per share with a total capitalization of more than 23 billion euros.

But apparently the shareholders did not agree with the valuation of the spun off company Iveco.

The CNH owners received one Iveco share for every five CNH shares.

Due to the spin-off, CNH did not go into trading on Monday at the closing price of the previous year at 17.1 euros, but at 14.8 euros.

Iveco was valued at 11.1 euros.

But on Monday afternoon the Iveco price was more than 14 percent in the red, while CNH was quoted just above the new level.

If you look at the conglomerate one last time as a unit, it lost value at the beginning of the year.

Stellantis shares reach record levels

As the most important shareholders, the Agnellis can cope with the loss. Because, like other investors on the Milan Stock Exchange, they can look back on a good year. The flagship index FTSE MIB gained around 24 percent to around 27,300 points. That was not the all-time high, but the index with its 30 stocks had only reached that shortly before on November 16 at 27,968 points. The two-year balance sheet is also impressive, with a plus of 15 percent.

The CEO of Borsa Italiana, Fabrizio Testa, recalled on Monday that the first listing of the previous year was the car manufacturer Stellantis, which arose from the merger of Fiat-Chrysler and Peugeot-Citroën (with subsidiary Opel). The shares of the fourth largest automaker in the world, whose most important shareholder is also the Agnelli family, rose by a good 40 percent on the Milan stock exchange last year and today gives the group a market value of around 53 billion euros. The listing of Stellantis shares ushered in a peak year of IPOs for the Italian stock market: Milan registered no less than 49 new listings with an issue volume of more than 2.4 billion euros on its main market as well as on the growth market for smaller companies,Euronext Growth Milano. That was the best value in more than two decades.

Analysts recommend buying Unicredit shares

In the ranking lists of winners and losers, one share in the financial sector stood out in particular last year: Unicredit, the parent company of Hypo-Vereinsbank, was the best title with a gain of a good 77 percent.

The arrival of the CEO Andrea Orcel, the presentation of an ambitious growth plan and the imagination with regard to possible acquisitions convinced many investors.

And although the paper is now quoted at 13.7 euros per share, giving the bank a market capitalization of around 30 billion euros, many analysts still recommend buying the paper.

They believe that the tarnished reputation of Italian banks is wrongly being weighed on Unicredit.

The proportion of analysts who still consider the paper to be attractive has even increased in the past three months.

The stock market continues to be determined by the pandemic

The second-best share of the past year was the industrial holding company CNH with an increase in value of almost 68 percent. On the other hand, Italy's most expensive group was disappointing: many investors consider the electricity manufacturer Enel, which is still worth more than 70 billion euros, to be overvalued. It lost around 15 percent of its value in 2021.

The further course of the stock exchange is also likely to depend on the pandemic, although the Italian economy has shown itself to be quite robust to Covid-19 despite strict regulations in the workplace.

In the coming days, the restrictions for non-vaccinated people are likely to increase again.

Bank Intesa Sanpaolo is nevertheless expecting economic growth of 4.3 percent this year.

"The clouds on the economic horizon currently appear less threatening in Italy than elsewhere," the analysts write.

They expect the economy to return to pre-pandemic levels by mid-year.

However, there are risks not only due to the spread of the virus, but also from the supply bottlenecks for industry and the energy shock.