Baltic equities did not post significant gains in the third quarter but still managed to edge ahead of foreign markets. The region’s main stock index, the OMX Baltic Benchmark, rose 2.9% over the quarter, reaching a new all-time high for the fourth consecutive quarter. Records are relatively rare on the Baltic stock market: it took more than four years for the previous peak, set in September 2021, to be surpassed at the end of 2025.

Over the past quarter, the S&P 500 returned 2.6% in EUR terms (or 2.0% in USD), while the STOXX Europe 600 fell 1.1%. The MSCI Emerging Markets index, which surged 25.5% in the second quarter on the back of a rally in South Korean and Taiwanese semiconductor stocks, was virtually flat, edging up just 0.2%.

Of the three Baltic exchanges, Riga was the strongest performer in the third quarter, with its index returning 7.4%. Tallinn followed with a gain of 6.2%. Lithuanian equities grew more slowly, with the OMX Vilnius rising 3.7%. The OMX Baltic Benchmark underperformed the individual exchange indices because it has a narrower focus on larger-cap companies, whose shares performed less well than those of smaller businesses over the quarter.

In the first nine months of the year, the Baltic equity index gained 6.3%, trailing foreign markets. Over the same period, the STOXX Europe 600 rose 7.2%, while the S&P 500 gained 15.6%. Driven by the rally in artificial intelligence-related stocks, the MSCI Emerging Markets index surged 27.5% year to date.

Baltic Core Property Fund IPO cancelled

In September, Baltic investors were offered an opportunity to participate in a new IPO. Lithuanian real estate fund manager Lords LB Asset Management sought to raise capital for its newly established Baltic Core Property Fund, with the fund units subsequently to be listed on the local stock exchange.

The initial offering was expected to raise up to EUR 35m to acquire the Artery business centre, located on Konstitucijos avenue in Vilnius, Lithuania’s equivalent of Wall Street. The building opened in 2024. Once additional capital had been raised, the fund planned to acquire K29, an office building opened in 2015 and located on the same Konstitucijos avenue. Both properties currently belong to other funds managed by Lords. The stated ambition was to raise a total of EUR 150m in equity for the newly established fund.

Both office buildings, particularly Artery, represent some of the best that the Lithuanian office market has to offer. They boast prime locations, high occupancy rates, quality tenants and modern construction, with K29 being only slightly older. Yet this was not enough to ensure a successful IPO.

The offering ran for almost a month, from 2 to 30 September. Once the subscription period ended, however, it was announced that the IPO was cancelled “due to insufficient investor demand”. Several factors may have contributed to this outcome: challenging conditions in Vilnius’s office rental market, the poor precedent set by Baltic Horizon, the fund’s legal structure (rather than a traditional joint-stock company), its fee structure, the rationale behind the IPO (a lack of foreign investors) and the relatively limited capital commitment from the management company (at over 5%), among other considerations.

An important point is that Lords is no newcomer to the local capital market. On the contrary, the firm is well known to most investors. Funds managed by Lords have successfully issued hundreds of millions of euros in bonds on local capital markets. The cancelled IPO nevertheless highlights the stark difference in Baltic investor sentiment towards debt and equity securities, and how difficult it is to translate success in the bond market into the equity market.

As international investors are no longer looking for acquisitions in the Baltic commercial real estate market amid geopolitical risks, a number of local real estate fund managers have potentially been considering similar IPOs. The cancellation of the Lords offering is likely to dampen such ambitions and push fund managers to seek alternative ways of exiting their investments.

How are this year’s local IPOs performing?

Even the biggest market frenzy of the year (or perhaps of all time), the SpaceX IPO, has given way to a tiny bit of common sense. Elon Musk’s company now trades at around 10% above its IPO price, despite having risen by as much as two-thirds at one point. On this occasion, why don’t we have a look at how this year’s Baltic stock market newcomers are faring?

Since the start of the year, two local IPOs have been completed. In May, Estonian real estate developer Liven raised EUR 4.9m in equity, selling 67% of the shares offered. At the end of June, LAU Infra, a Latvian state-controlled road construction and maintenance company, raised EUR 6.2m by selling 77% of its offering.

By the end of September, Liven shares had fallen 26% below their IPO price. Trading turnover in the third quarter amounted to EUR 0.4m, making it the 27th most liquid stock on Nasdaq Baltic by this measure.

LAU Infra’s share price has performed better than Liven’s, but has yet to deliver a profit for IPO investors. At the end of September, its shares were trading around 2% below the offering price. Investors traded EUR 0.3m worth of LAU Infra shares during the quarter, leaving it in 30th place by turnover.

So far, investors have not benefitted from this year’s Baltic IPOs. But equity investing is a long game, and it remains to be seen how these companies develop in the years ahead.

Infortar has risen 2.5-fold since its 2023 IPO and is now the second-largest listed company

Of the nearly 70 stocks listed on the Baltic exchanges, in the third quarter 31 rose and 35 declined.

Among companies with a market capitalisation exceeding EUR 100m, the strongest performer was Estonian investment group Infortar. Its share price jumped 27.0% over the quarter and is now up 40.0% since the start of the year.

Infortar is still a relatively recent arrival on the Baltic stock exchanges, having completed its IPO only in late 2023. Yet investors who participated in the offering have already made 2.5 times their initial investment, even excluding dividends.

With a market capitalisation of EUR 1.35bn, Infortar has become the second-largest company listed on Nasdaq Baltic. It trails only Lithuania’s energy group Ignitis, valued at EUR 1.58bn. During the third quarter, Infortar overtook Telia Lietuva, with a market capitalisation of EUR 1.30bn, and LHV, valued at EUR 1.07bn.

The second-best performer among larger stocks was Litgrid, Lithuania’s electricity transmission system operator. Its share price rose 11.3% over the quarter and 35.4% year to date. Latvian bank and asset manager INDEXO followed closely, gaining 11.0% over the quarter. In early August, Litgrid reported that adjusted EBITDA for the first half of 2026 had increased 12% to EUR 29.9m, while adjusted net profit rose 40% to EUR 20.2m.

INDEXO, meanwhile, reported continued rapid business growth. In the second quarter alone, its loan portfolio expanded 10% from the end of the first quarter to EUR 262m, while assets under management grew 14% to EUR 1,711m. INDEXO owns 72% of DelfinGroup, which is also listed on the Riga Stock Exchange.

Tallinn’s port continues to struggle

Tallinna Sadam, the operator of the Port of Tallinn, was the worst-performing stock among companies with a market capitalisation above EUR 100m. Its share price fell 4.6% over the quarter. The company reported continued declines in passenger and cargo volumes in the second quarter. Although quarterly revenue rose 5.4% year on year to EUR 31.1m, higher costs pushed adjusted EBITDA down 11% to EUR 14.2m. Net profit plunged 59% to EUR 1.4m.

The second-worst performer was Tallinna Vesi, which operates Tallinn’s drinking water and wastewater networks. Its shares fell 4.0%. The company reported a net loss of EUR 0.1m in the second quarter of 2026, compared with a profit of EUR 1.4m in the same period of 2025 and more than EUR 2m in the second quarter of 2024.

Estonian bank LHV was the third-worst performer among larger stocks, declining 2.5%. Other listed banks managed modest gains: Estonia’s Coop rose 1.1%, while Lithuania’s Artea gained 3.1%. LHV reported that second-quarter net profit fell by more than 25% year on year to EUR 24.7m, while its return on equity (ROE) declined from 17.4% to 13.1%. The main drag on profit was impairment losses, as profit before impairments actually increased by 6%. Artea reported an even steeper decline. Its net profit almost halved to EUR 7.8m in the second quarter of 2026, with ROE standing at just 5.2%. Coop, by contrast, pleased investors with a 24% increase in net profit to EUR 8.2m and an ROE of 13.5%.

There was also a pause in the rally in Vilkyškių pieninė. Its share price fell 2.2% in the third quarter, after being the best-performing larger Baltic stock in the second quarter, when it surged 38.9%. The dairy processor’s shares remain up 30.6% since the start of the year. The company reported second-quarter adjusted EBITDA of EUR 10.7m, around two-thirds higher than a year earlier. The increase was impacted by the acquisition of Marijampolės pieno konservai and the opening of a new cheese factory in Latvia.

First quarter of rising investor activity this year

After a decline in trading volumes in the first half, investor activity improved again. The third quarter was the first one this year in which equity trading turnover increased compared with the same period a year earlier.

Combined turnover across all three Baltic exchanges rose 20%, from EUR 100m in the third quarter of 2025 to EUR 120m in the same period this year. However, following declines in the first two quarters, the total value of shares traded in the first nine months of 2026 remains 10% below the level recorded a year earlier.

Trends were broadly similar across the individual exchanges this time. In Vilnius, equity trading turnover in the third quarter increased 17% to EUR 58m, slightly ahead of Tallinn, where turnover reached EUR 56m, up 23% year on year. Riga, the least active of the three exchanges, recorded an 18% increase to EUR 6m.

Ignitis retains its crown as the most liquid stock

Of the nearly 70 stocks listed on Nasdaq Baltic, 30 recorded an increase in trading activity during the third quarter. All five of the most liquid stocks saw turnover rise compared with the third quarter of 2025.

Ignitis retained its position as the most actively traded Baltic stock, with turnover increasing 29% to EUR 29m. Banks occupied the next three places in the ranking. LHV turnover rose 36% to EUR 20m, Artea’s increased 3% to EUR 15m, the slowest growth among the top five, while Coop recorded the strongest increase, with turnover surging 123% to EUR 12m. Telia Lietuva rounded out the top five, with turnover rising 61% to EUR 4m.

Baltic equities posted gains in the second quarter but significantly lagged the stronger rally in international markets. The OMX Baltic Benchmark index rose 3.3%, held back primarily by Estonian and Latvian stocks. Tallinn’s main index gained just 2.1%, while Riga advanced 3.2%. Vilnius, by contrast, was much closer to global market trends, climbing 8.1%. Despite the relatively modest quarterly performance, the OMX Baltic Benchmark reached a new all-time high in early May.

International equity markets also hit record highs. Compared with Baltic stocks, they rebounded much more strongly after a weak first quarter, when investor sentiment was shaken by the outbreak of war in Iran and the resulting spike in oil prices. Optimism returned during the second quarter as investors increasingly anticipated an end to hostilities in the Middle East and oil prices retreated. Artificial intelligence-related stocks also rallied.

Over the three months to the end of June, the S&P 500 gained 16.2% in EUR terms (14.9% in USD). Europe’s STOXX Europe 600 rose a more moderate 9.9%. Emerging markets delivered particularly strong returns, driven by AI-related semiconductor companies in South Korea and Taiwan. The MSCI Emerging Markets Index surged 25.5% in EUR terms, its strongest quarterly performance since 2009. South Korean equities rose by around 50%, while Taiwanese stocks gained approximately one-third.

Unlike bond issues, Baltic equity IPOs failed to generate investor interest

The second quarter saw the first Baltic equity IPOs of the year, with Estonia’s Liven and Latvia’s LAU Infra coming to market. At the same time, global investors had found a “new crypto”. Everyone went crazy about Elon Musk’s SpaceX IPO. Unfortunately, Baltic IPOs generated nothing comparable, not even compared with recent Baltic bond offerings. Although both IPOs attracted a respectable number of investors, around 2,000 or more in each case, neither company managed to sell the full amount of shares on offer.

In May, Estonian residential property developer Liven raised EUR 4.9m of equity from 2,421 investors. However, it sold only 67% of the shares offered. By the end of June, its share price was 22% below the IPO price, giving the company a market capitalisation of EUR 48m. Liven was far from a newcomer to the capital markets. It had previously completed two successful EUR 6m bond issues. The first, launched in May 2024, was 3.6 times oversubscribed, while the second, completed in March 2025, was 2.1 times oversubscribed.

The contrast illustrates just how much stronger demand from local investors remains for bonds than for equities. Raising equity capital through an IPO is currently far more difficult than raising debt through the bond market in the Baltics.

At the end of June, Latvia’s state-controlled road construction and maintenance company LAU Infra completed its IPO, raising EUR 6.2m after selling 77% of the shares offered. The offering attracted 1,981 investors. The shares began trading on Nasdaq Riga on 3 July. By mid-July, they were trading broadly in line with the IPO price, implying a market capitalisation of around EUR 55m.

Where have the local institutional investors gone?

The last time a Baltic equity offering (an IPO or a secondary placement) was oversubscribed was in November 2024 when Latvian coffee company Kalve Coffee went public. Since then, all six public equity offerings have failed to raise their target amount, with companies placing, on average, only 60% of the shares offered.

The shortage of institutional investors has become increasingly evident in the Baltic capital market. International institutions have never been particularly active, especially in smaller offerings, but recently even local institutions have largely stepped back.

In Lithuania, domestic pension funds have traditionally been the most important institutional investors. However, following the pension reform that allows savers to withdraw assets accumulated in the second pillar, pension funds are now more focused on exiting their investments than making new ones. If the likelihood of new IPOs in Lithuania was previously limited, it has now become microscopic.

Vilkyškių pieninė and KN Energies continued their strong run

Of the 70 equity securities listed on Nasdaq Baltic, 31 gained during the second quarter. Among companies with a market capitalisation of at least EUR 100m (24 at the end of June), the strongest performer was Lithuanian dairy producer Vilkyškių pieninė whose shares rose 38.9%. The company has been one of the Baltic market’s best-performing stocks in recent years. Since the beginning of 2024, its share price has tripled.

At the end of May, Vilkyškių pieninė reported first-quarter revenue of EUR 87m, up 22% year-on-year, while net profit increased 26% to EUR 5.1m. The company also announced that, following the opening of its new cheese factory in Latvia and the acquisition of Marijampolės Pieno Konservai, it expects revenue to increase by around 50% this year to EUR 430m. Over the longer term, management believes existing production capacity can support annual revenue of EUR 600m. The company paid a dividend of EUR 0.23 per share for 2025, equivalent to a dividend yield of around 2%.

Shares in Lithuanian electricity transmission operator Litgrid gained 15.9%, making it the second-best performing large-cap stock during the quarter. The company reported first-quarter adjusted EBITDA of EUR 15.2m, up 7%, while adjusted net profit declined 5% to EUR 7.8m. Litgrid also paid a dividend of EUR 0.054 per share, representing a dividend yield of just over 5%.

Third place went to oil and LNG terminal operator KN Energies, whose shares advanced 13.6%. Like Vilkyškių pieninė, it has been one of the Baltic market’s strongest performers in recent years, with its share price more than doubling since the beginning of 2024. At the end of May, KN Energies reported first-quarter revenue of EUR 29.8m, up 18%, while net profit jumped by two-thirds to EUR 7.3m. The improvement was driven by higher earnings from both its regulated business and commercial LNG activities. The company also paid a 2025 dividend of EUR 0.029 per share, corresponding to a yield of approximately 6%.

Tallinn port and banks among the weakest performers

Tallinna Sadam, the operator of Tallinn port, was the worst-performing large-cap Baltic stock during the second quarter, with its shares falling 8.7%. Investors reacted negatively to the company’s first-quarter results. Revenue slipped only 0.7% to EUR 28.1m, but adjusted EBITDA fell 17% to EUR 11.6m and net profit dropped 33% to EUR 4.6m. In early July, the company also reported continued declines in passenger and cargo volumes during the second quarter. The company paid a 2025 dividend equivalent to a yield of around 5%.

The banking sector also disappointed investors. Estonia’s LHV (-5.4%) and Lithuania’s Artea (-5.0%) were the second and third weakest-performing large-cap stocks of the quarter. Both banks paid dividends in April, with yields of approximately 5%. However, their first-quarter results failed to impress investors. LHV reported a 32% decline in net profit to EUR 19.7m, while net interest income fell 4%. Artea’s net profit declined 13% to EUR 15.4m despite a 4% increase in net interest income. Both banks nevertheless continued to expand lending. Compared with the end of 2025, LHV’s loan portfolio increased by 2%, or EUR 120m, while Artea’s grew by 1%, or EUR 42m.

In March, Tesonet announced an agreement to increase its stake in Artea from 7.3% to 31.7% by acquiring shares from existing major shareholders at a valuation of 1.2x book value, currently equivalent to EUR 1.08 per share. Artea’s market price still remained around 20% below the price paid by Tesonet.

Investor activity declines as withdrawn private pensions in Lithuania fail to reach the stock market

Last year’s recovery in Baltic equity trading now appears to have been short-lived. Investor activity slowed even more sharply in the second quarter than in the first.

Total turnover across the three Baltic exchanges reached EUR 127m during the quarter, down 29% from a year earlier. January was the only month this year to record year-on-year growth in trading activity. The following five months all posted declines.

Part of the decline reflects unusually high trading volumes in Enefit Green shares during the first half of last year after the company announced plans to delist. The stock left the exchange in July 2025.

Trading activity weakened at a broadly similar pace across all three Baltic exchanges. Vilnius, which had been the region’s most active exchange during the fourth quarter of last year and the first quarter of this year, ceded that position back to Tallinn.

Turnover on Nasdaq Vilnius fell 28% to EUR 59m, while Tallinn recorded a 30% decline to EUR 64m. Excluding the impact of Enefit Green’s delisting, Tallinn’s turnover would have fallen by only 6%. Against that backdrop, the almost one-third decline in trading activity in Vilnius appears even more striking.

There had been hopes that at least part of the money withdrawn from Lithuania’s second-pillar pension system this year would find its way back into the domestic equity market. The sums involved were substantial. During the first withdrawal window in April alone, savers withdrew assets equivalent to around 40% of total second-pillar pension assets.

However, the sharp decline in turnover on the Vilnius exchange suggests that this hope has remained just that. Instead of being reinvested in equities, much of the money appears to have been “invested” in washing machines and all-inclusive holidays in Turkey.

Ignitis remains the Baltic market’s most actively traded stock

Of the 70 securities listed on Nasdaq Baltic, 31 recorded higher trading activity during the second quarter. The five most actively traded stocks included two Lithuanian and three Estonian companies. Trading volumes in the Lithuanian names declined significantly compared with the second quarter of 2025, while the Estonian companies all recorded higher turnover.

Ignitis retained its position as the Baltic market’s most actively traded stock, despite turnover falling 35% year-on-year to EUR 26m. Artea was the only other Lithuanian company in the top five. Its turnover declined 42% to EUR 14m, leaving it in third place.

LHV ranked second with turnover of EUR 22m, up 7% year-on-year. Estonian ferry operator Tallink held fourth place, with turnover increasing 5% to EUR 9m. The top five was completed by Coop Pank, whose turnover rose 10% to EUR 7m. The Estonian lender replaced Telia Lietuva, which had entered the top five during the first quarter.

Following last year’s recovery in Baltic equity markets, positive sentiment carried into the beginning of 2026. However, it later proved unable to withstand rising uncertainty in global financial markets, triggered by the outbreak of war in Iran and the resulting surge in oil prices. At the end of January, the OMX Baltic Benchmark index reached a new all-time high of 1,790 points, up 2.6% from the end of last year. It subsequently declined and finished the first quarter at the same level as at the end of 2025.

Despite this, Baltic equities still outperformed both the US and western Europe. The S&P 500 fell 3.1% over the quarter in euro terms (down 4.6% in USD terms). STOXX Europe 600 declined 1.4%. The MSCI Emerging Markets index, which significantly outperformed developed markets last year, posted a modest gain of 1.4% in euro terms (a 0.2% decline in USD terms).

Quarter highlight: Tesonet and Artea news

In mid-March, a major announcement came from Lithuanian technology star Tesonet. It revealed an agreement to increase its stake in Artea bank from 7.3% to 31.7%, becoming the largest shareholder of the Vilnius-listed bank. Currently, the largest shareholder is Lithuanian investment group Invalda INVL, which holds 19.9% and will also sell part of its stake to Tesonet. Moreover, Tesonet announced it will seek approval from the European Central Bank to acquire a controlling stake in Artea.

This development is significant for at least two reasons. First, a closer partnership between a local bank and one of Lithuania’s largest and most advanced technology companies with global presence could have a meaningful impact on Artea’s future development. Tesonet has not yet disclosed its strategic vision for the bank. Could this become a new Revolut? A digital-first bank operating across multiple geographies? Time will tell. It will be very interesting to observe the strategic changes in Artea that may follow Tesonet becoming the largest — and potentially controlling — shareholder.

Second, the importance lies not only in the stake increase itself but also in the price paid. Investors in Baltic markets are accustomed — particularly in the context of buyouts from minority shareholders — to seeing major shareholders pay market price or even less. Tesonet, by contrast, agreed to acquire shares at a significant premium. The technology company will pay 1.2x book value. With book value per share at €0.92 at the end of 2025, this implies a price of €1.11 per share — 29% above the market price prior to the announcement. The price paid by a strategic investor signals its view of intrinsic value. Clearly, Tesonet sees significantly higher value in Artea than the market price suggests. Unsurprisingly, the share price rose 11% to €0.953 on the first trading day after the announcement. By quarter-end, it stood at €0.92, equal to book value, implying roughly 20% upside based on Tesonet’s valuation multiple of 1.2x.

Among top gainers: a long-awaited return of Harju Elekter

Out of 70 listed securities on Nasdaq Baltic, 30 recorded price increases during the quarter. Among larger companies with market capitalisation above €100m (24 companies at the end of March), the top performer was Estonia’s electrical equipment solutions provider Harju Elekter, with a gain of 15.5%.

Having been somewhat overlooked by investors and after several challenging years, the company achieved a breakthrough in 2025. By focusing on higher-margin projects and improving efficiency, it increased net profit more than threefold from €3.2m to €10.8m, despite flat revenues.

The second-best performer among larger stocks was Invalda INVL, up 10.2%. The company is set to publish its full-year results on April 8. Over the 12 months to September 2025, its net asset value rose 17% to €222m. For comparison, its market capitalisation stood significantly higher at €320m at the end of the first quarter of 2026.

The third-best performer was Telia Lietuva, whose shares rose 9.5%. The telecoms company reported that EBITDA increased 17% to €48.6m in the final quarter of last year, while net profit rose by one-third to €22.7m. In early March, it proposed a dividend of €0.14 per share, corresponding to a yield of around 7% and reinforcing its status as one of the most reliable dividend stocks in the Baltic market.

Last year’s leaders among the biggest decliners

Among the biggest decliners were also some of last year’s top performers, including Lithuanian agricultural and food group Akola and Estonian construction company Merko Ehitus.

Akola, the second-best performing large Baltic stock in 2025 (+58%), fell 15.8% in the first three months of this year. In February, the company reported a net loss of €21 thousand for its second financial quarter (October–December 2025), compared with a €7m profit a year earlier. In March, Akola carried out a share buyback via auction. Investors offered to sell nine times more shares than the company intended to repurchase. The company allowed investors to pick from three selling price levels — €1.81, €1.78 and €1.75 — compared with a pre-announcement market price of €1.725. Ultimately, shares were repurchased at €1.75. Following the buyback, the share price declined and ended the quarter at €1.55.

Merko Ehitus was the second-largest decliner, down 13.4%. In 2025, it had been the third-best performer, delivering a 50% return. The decline followed February results showing that fourth-quarter net profit fell by more than 80%, from €20m to €3m. The company proposed a dividend of €1.25 per share for 2025 — significantly lower than €1.90 the previous year. This implied a yield of 3.8% based on the pre-announcement price, relatively modest for a Baltic dividend stock.

The third-largest decline was recorded by Lithuanian gas transmission operator Amber Grid, down 9.2%. At the end of February, the company reported that net profit fell from €8.3m to €1.4m. However, adjusted net profit — excluding temporary regulatory differences — remained stable at €10m. This implies that lower-than-expected revenue or higher-than-expected costs in 2025 will be compensated through higher tariffs in the future. At the end of March, the company proposed a dividend of €0.056 per share (nearly 5% yield), only slightly below €0.06 the previous year. In absolute terms, the proposed dividend corresponds to €10m, broadly in line with adjusted net profit.

Investor activity growth stalls again

Last year saw a recovery in investor activity after a three-year decline. Total trading turnover on Nasdaq Baltic rose 40% to €562m in 2025, and in the second half of the year Vilnius overtook Tallinn as the most liquid Baltic exchange.

However, this growth stalled at the start of this year. After four consecutive positive quarters, total turnover across the three exchanges declined 9% year-on-year to €136m in the first quarter. The trend mirrored broader market sentiment: trading volumes still rose 17% in January but declined significantly in February and March.

Investor activity diverged between Vilnius and Tallinn. Turnover continued to grow in Vilnius, while it declined in Tallinn, partly due to the absence of one of the most liquid stocks — renewable energy producer Enefit Green — which had generated €25m in turnover in the first quarter of last year before being delisted in July.

In Vilnius, turnover rose 16% to €65.5m — the most active first quarter since 2023. In contrast, Tallinn saw a 25% decline to €65.1m, slightly below Vilnius. Riga also recorded a negative trend, with turnover falling 17% to €5m, representing just 4% of total Nasdaq Baltic trading.

Telia Lietuva enters top five most traded stocks

Out of 70 listed securities, 36 recorded increased investor activity. The most liquid stock of the first quarter of 2025 — Enefit Green — is no longer present following its delisting.

Telia Lietuva entered the top five most traded stocks, rising from 10th to 5th place, with turnover increasing 61% to €8m. As a result, the top five now includes three Lithuanian and two Estonian companies — a shift from the previously dominant Estonian presence.

Ignitis, last year’s leader, remained the most actively traded stock, with turnover reaching €29m, up 30% year-on-year. Second and third places were held by bank stocks — Estonia’s LHV (€21m) and Lithuania’s Artea (€14m) — both recording lower turnover. Estonian ferry operator Tallink ranked fourth with €9m in turnover, up 12% from a year earlier.

By relative stock market size — measured as the ratio of market capitalisation to GDP — the Baltic states rank near the bottom among the EU’s 27 members. Estonia stands 23rd, Lithuania 25th and Latvia last, in 27th place. More broadly, eastern European countries, whose stock exchanges only opened after 1990, lag well behind their western European peers.

By investor activity, Baltic equity markets appear somewhat stronger, though still well below the EU average. Ranking member states by the ratio of annual stock trading turnover to market capitalisation, Estonia places 17th, Lithuania 19th and Latvia 21st. While equity markets in the region are very small, listed companies tend to be traded relatively actively. This suggests that the more pressing issue is the shortage of listed companies rather than weak investor participation. To foster the development of Baltic equity markets, the primary focus should be on attracting new, sizeable companies to list.

Strong macroeconomic progress

All three Baltic countries rank among the EU’s strongest performers in terms of economic convergence. Lithuania’s GDP per capita in purchasing power standards reached 87% of the EU average in 2024 — an increase of 28 percentage points since 2010, the second-largest improvement after Ireland over that period. Lithuania now ranks 17th among EU member states, up from 24th in 2010.

Estonia’s GDP per capita stood at 79% of the EU average in 2024, up 14 percentage points since 2010, placing it 19th in the EU.

Latvia’s figure reached 69% of the EU average, an increase of 17 percentage points, ranking 25th among member states.

Baltic markets near the bottom by capitalisation-to-GDP

The most widely used metric for assessing stock market development is the ratio of total market capitalisation of listed companies to GDP. This indicator captures the size of the equity market relative to the economy and enables cross-country comparison.

Across the EU in 2025, Sweden ranked first, with market capitalisation equivalent to 193% of GDP — meaning the value of stocks traded in Stockholm was nearly double the size of the economy. The Netherlands ranked second at 132%, followed by Denmark at 128%. In total, five EU countries recorded stock market capitalisation exceeding annual GDP. The EU-wide weighted average stood at 68%.

The Baltic states fall far short of this benchmark and occupy the lower end of the ranking. Estonia leads the region in 23rd place, with market capitalisation at 9% of GDP — roughly six times below the EU average. Lithuania ranks 25th, with a ratio of 7%, or around ten times lower than the EU average. Latvia ranks last, with capitalisation at just 1% of GDP — 49 times below the EU average.

Eastern Europe lags behind the west

The Baltic underperformance reflects a broader regional pattern. Eastern European countries — largely newer EU members — trail western European economies. When ranked by market capitalisation-to-GDP, the upper half of the table is dominated by western Europe, while eastern European countries are concentrated in the lower half.

The highest-ranked eastern European markets are Croatia (14th, 35%) and Poland (15th, 29%), both still roughly half the EU average.

This gap is largely explained by history. Stock exchanges across the Baltic states and much of eastern Europe were established only after 1990, following the collapse of the Soviet system and the transition to market economies. By contrast, western Europe benefits from deep-rooted capital market traditions spanning centuries. The Amsterdam exchange — widely regarded as the world’s first — dates back to the early 17th century.

Investor activity paints a more favourable picture

Another key measure of market development is the ratio of annual equity trading turnover to market capitalisation, which captures how actively investors trade listed shares.

In 2025, Italy ranked first in the EU, with turnover equivalent to 82% of market capitalisation. Notably, Italy ranks only 11th by market size, indicating that relatively smaller markets can still sustain high trading activity. Germany came second at 56%, followed by Ireland at 49%. The EU weighted average stood at 43%.

The Baltic markets perform somewhat better on this metric, though still lagging significantly behind the EU average. Estonia ranks 17th, with turnover at 5.7% of market capitalisation in 2025. Lithuania follows in 19th place at 4.5%, while Latvia ranks 21st with 3.7%.

Interestingly, relatively higher trading activity in the Baltic states is driven primarily by domestic retail investors rather than foreign or institutional participants.

At the bottom of the ranking are Cyprus, Slovakia and Luxembourg, where trading turnover does not reach even 1% of market capitalisation.

A shortage of listings, not investors

Debate about the underdevelopment of Baltic equity markets often centres on a “chicken-and-egg” problem: there are too few listed companies because there are not enough investors, and too few investors because there are not enough listed companies.

However, comparing the two development indicators offers useful insight. The Baltic states rank higher within the EU by trading activity than by market size. This suggests that while markets are small, existing listed companies are traded relatively actively — even if still below EU averages.

The implication is that the primary constraint is the lack of listed companies rather than insufficient investor demand.

To accelerate development, efforts of market participants should prioritise attracting new, large companies with meaningful free floats to public markets. This would broaden investment opportunities for existing participants and likely help attract new investors, both domestically and internationally.

Scandinavia as a benchmark

Scandinavia — geographically and culturally close to the Baltic region — stands out for its highly developed capital markets. Sweden, Denmark and Finland all rank among the top four EU countries by market capitalisation-to-GDP (alongside the Netherlands).

They also perform strongly in terms of trading activity: Denmark ranks 5th, Sweden 8th and Finland 11th.

Even in absolute terms, these markets are sizeable. Sweden is the EU’s fourth-largest equity market, despite being only the 11th-largest member state by population. Denmark ranks 16th by population, and Finland 17th.

Scandinavia demonstrates that even relatively small countries can sustain deep and active capital markets — offering a compelling model for the Baltic states to follow.

Most Baltic corporate bonds are listed on the Nasdaq Baltic exchanges. While Vilnius leads in terms of market size — with the highest number of listed issues and the largest aggregate value — it ranks last in secondary market activity. Bonds listed in Vilnius accounted for just 9% of total turnover across the three exchanges and only 5% of all transactions. It seems that Lithuanian investors have yet to embrace secondary bond trading on exchange.

By contrast, Riga — a marginal player in equity trading — has emerged as the Baltic leader in secondary bond turnover. The Latvian exchange accounted for 61% of total corporate bond trading by value in 2025.

In attempting to foster exchange-based secondary bond trading, the Baltic exchanges are seeking to build something largely absent in developed bond markets such as western Europe or the US. In those markets, secondary trading in corporate debt overwhelmingly takes place over the counter, with investors transacting through dealers rather than on centralised exchanges. Whether the Baltic experiment in creating an active on-exchange bond market will succeed remains an open question.

More than 160 bonds worth over €4bn

In 2025, 161 corporate bond issues from 101 companies were listed across the three Baltic exchanges. Estonia’s Bigbank had the largest number of listed issues, with six outstanding bonds. Latvia’s Citadele bank and financial services group DelfinGroup each had five.

According to exchange data, the total market value of listed corporate bonds stood at €4.4bn at year-end. By comparison, the total market capitalisation of equities traded on Nasdaq Baltic was €11.3bn.

Vilnius was the largest exchange by both number and value of listed bonds. A total of 64 corporate bond issues were listed in Lithuania, with a combined value of €2.0bn at year-end. Riga hosted 58 issues worth €1.7bn, while Tallinn listed 39 bonds with a total value of €0.6bn.

Riga dominates secondary trading

Of the 161 listed issues, 45 did record a single on-exchange trade during the year. These included bonds from large and well-known issuers such as Ignitis, Maxima and Latvenergo. However, these issues were targeted exclusively at institutional investors and carried minimum investment thresholds of €100,000. Institutional investors typically trade bonds over the counter rather than on exchange.

In total, more than 18 thousand bond transactions were executed on the Nasdaq Baltic secondary market in 2025, with an aggregate value of €122m.

Riga was the clear leader, generating €74m of turnover — 61 per cent of the Baltic total. Tallinn ranked second with €37m (3%), while Vilnius lagged with just €11m, or 9% of total turnover. Measured by number of transactions, Vilnius performed even more weakly, accounting for only 5% of all Nasdaq Baltic corporate bond trades. Given that domestic investors tend to dominate trading activity on their respective exchanges, the figures suggest that Lithuanian investors have yet to embrace exchange-based bond trading in meaningful numbers.

This stands in sharp contrast to equity trading. In the second half of 2025, Vilnius became the most active Baltic equity exchange, overtaking Tallinn, while Riga accounted for just 4% of total Nasdaq Baltic equity turnover.

Liquidity lags equities

The disparity in liquidity between bonds and equities is more than clear. In 2025, the three Baltic exchanges recorded 949 thousand equity trades with a combined value of €562m — 52 times more transactions and 4.6 times higher turnover than in bonds.

The difference is hardly surprising. Equity investors have effectively one route to exit their positions: selling on exchange. Bondholders, by contrast, have a defined redemption date at which their securities are repaid at maturity. As a result, secondary market liquidity is typically less critical for bond investors.

Most actively traded bond issuer: Citadele

The list of most actively traded bond issuers is dominated by Latvian and Estonian companies. Ranking issuers by on-exchange bond turnover, the first Lithuanian name appears only in 17th place: media group 15min, whose bonds generated €2.1m in turnover across 83 trades. Other Lithuanian issuers further down the ranking include Artea Bank in 24th place with €1.3m in turnover (266 trades), and Kvartalas, the developer of the Sąvaržėlė business centre, 26th place with €1.2m (43 trades).

Among the ten most actively traded bond issuers, six list their bonds in Riga and four in Tallinn. Seven of the top ten operate in the financial sector, including banks and consumer lending businesses.

Citadele emerged as the most actively traded Baltic issuer, with bond turnover reaching €9.8m across 118 transactions. Notably, the Latvian bank secured the top position despite the fact that two of its five bond issues listed in Riga did not record a single trade during 2025.

The rally in Baltic equities in 2025 coincided with a pick-up in European and emerging market equities. The local benchmark slightly outperformed the STOXX Europe 600 (+17%) and the MSCI Emerging Markets Index (+18% in euro terms). Baltic stocks also delivered a markedly better result than US equities: following a 13% decline in the US dollar, the S&P 500 returned just 3% when measured in euros.

Looking at the three Baltic markets individually, Lithuanian equities delivered the strongest performance. The OMX Vilnius index rose by 26%, outperforming both OMX Tallinn (+18%) and OMX Riga (+6%).

Three in four stocks appreciated

Out of 69 listed companies, as many as 52 recorded positive share price performance over the year. The strength of the market is further illustrated by the fact that among companies with a market capitalisation above €100m, not a single stock declined in value.

Lithuanian companies dominated the list of top performers among larger names, while Estonian stocks were more prevalent among the laggards. The strongest performers of the year were KN Energies (+71%), Akola (+58%), Merko Ehitus (+50%), Vilkyškių pieninė (+44%) and Rokiškio sūris (+27%).

At the other end of the spectrum were TKM Grupp (+0.3%), Tallink (+1%), EfTEN Real Estate Fund (+1%), Eleving (+2%) and Infortar (+6%).

Investor activity reaches a three-year high

Equity trading turnover on Nasdaq Baltic had declined for three consecutive years, falling from €917m in 2021 to €401m in 2024. In 2025, that trend finally reversed. Aggregate turnover across the three Baltic exchanges rose by 40% to €562m, the highest level in three years.

Liquidity grew most rapidly in Vilnius, where turnover jumped by 71% to €256m, accounting for 46% of total Nasdaq Baltic turnover. Activity increased more modestly in Tallinn, rising by 19% to €284m, or 50% of the total.

Although Tallinn remained ahead of Vilnius on a full-year basis, trading volumes in Vilnius exceeded those in Tallinn during the second half of the year, following the delisting of Enefit Green. As a result, Vilnius assumed the position of the most active Baltic exchange — a notable achievement, given that turnover in Tallinn had been roughly 1.5 times higher than in Vilnius over the past five years.

Turnover on the Riga exchange increased by 65%, but still amounted to just €22m, or 4% of total Nasdaq Baltic activity.

Vilnius becomes the largest and most active Baltic exchange

Vilnius overtook Tallinn not only in terms of liquidity, but also market size. The aggregate market capitalisation of companies listed in Vilnius increased from €4.9bn to €5.7bn over the year. At year-end, this represented 51% of total Nasdaq Baltic market capitalisation, which stood at €11.3bn.

By contrast, the combined market capitalisation of companies listed in Estonia declined from €5.2bn to €5.0bn, largely due to the delisting of Enefit Green. In Riga, total market capitalisation rose from €0.5bn to €0.6bn.

Two Lithuanian companies at the top of most traded stocks

The list of the five most actively traded stocks remained unchanged from 2024, although the rankings shifted. Rising from second place, Ignitis became the most traded stock in the Baltic market, with turnover reaching €103m — a 72% increase year on year. The company’s share price rose by 8%. Artea climbed to second place, with turnover jumping 65% to €88m. Among the five most liquid stocks, the Lithuanian bank also recorded the strongest share price performance, gaining 14%. LHV, the most actively traded stock in 2024, slipped to third place despite a 27% increase in turnover to €80m. The Estonian bank’s shares rose by 10% in 2025. Delisted Enefit Green ranked fourth with €48m in turnover, while Tallink completed the top five, with turnover declining by 7% to €31m — the only stock in the group to see a year-on-year decrease in trading activity.

Primary market remains largely dormant

Despite the long-awaited recovery in the secondary market, the Baltic primary market remains effectively closed. Only three primary market transactions took place in 2025.

Estonian construction solutions company Primostar completed a €0.4m initial public offering, while Latvian financial services company Indexo raised €7.7m through two secondary public offerings. All three transactions were undersubscribed by investors.

Event of the year: the delisting of Enefit Green

At the beginning of 2025, few would have predicted that one of the largest and most liquid companies on the Baltic exchanges — and one that had gone public only a few years earlier — would leave from the market.

In March, Estonia’s state-owned energy group Eesti Energia announced a buyout of minority shareholders in renewable power producer Enefit Green. The offer price represented a 47% premium to the prevailing market price prior to the announcement.

The size of the premium was positively received by investors, particularly given that Baltic markets have become accustomed to seeing minority shareholders bought out at prices close to — or even below — prevailing market levels.

The timing also came as a surprise: just over three years had passed since Enefit Green’s IPO in October 2021. Investors who participated in the IPO and tendered their shares in the buyout realised a total return of 33%, including dividends paid over the three-year period.

The company was delisted from Nasdaq Tallinn in early July. While the buyout process was conducted transparently and at an attractive price, the transaction nevertheless represents a significant loss for the local capital market, which has been deprived of one of its largest and most liquid listed companies.