May 12, 2008
FSU oil and gas monitor
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Performance and ratings update. Russian oil and gas stocks were very strong last week (up 7.9%), outperforming their peers from other FSU countries (up 5.4%); the Bloomberg World Oil and Gas Index (up 2.6%); the MSCI Renaissance Index (up 0.6%) and the MSCI Emerging Markets Index (down 0.9%). Among the blue chips, LUKOIL, Novatek and Tatneft demonstrated the best performance, up 12.2%, 11.8% and 10%, respectively. Among the small caps, the best performers were Bryanskoblgaz, Nizhegorodoblgaz and West Siberian Resources, up 25%, 17.9% and 12.5%, respectively. Following the recent shar-price performance, we have upgraded Kostromaoblgaz to BUY from Hold and downgraded Bryanskoblgaz to HOLD from Buy.
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May 12, 2008
Ukrainian agriculture: The bread basket of Europe
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This, introductory report on the agricultural sector in Ukraine examines the country's agricultural land market and its capacity to produce and trade soft commodities, and looks at Ukraine's largest agricultural producers. We also include profiles of Kernel, Astarta, MCB Agricole and Creativ Group, which we rank highly among Ukrainian agricultural companies, based on their business models, management quality and growth potential.
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May 8, 2008
Astarta Kiev: More than just sugar
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Diversified revenue stream. Astarta’s sugar business will continue contributing over 60% to its revenues as the company seeks a 10% market share by volume from YE09. We forecast the share of revenues from grain production and farming to increase from 23% in 2006 to 31% in 2012 and growth rates to be 10% and 26% per year, respectively. This will be achieved via a larger land bank in operation, increasing yields and equipment upgrades at its milk farms.
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May 8, 2008
Financials monthly – Russia, CIS
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Both VTB and Sberbank reported strong FY07 numbers during April. However, neither set the tone for a sustained share price rally following results conference calls during which VTB indicated a difficult 2008E ahead of it and Sberbank delivered a mixed message on 2008E costs and highlighted that any clear communication and delivery on its new strategy is likely to be a 2H08 story.
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May 8, 2008
Medvedev is in - What are the implications?
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No revaluation of the rouble to the basket in the immediate future
Possible rating upgrade from Moody’s, and in 2H from S&P
Dmitry Medvedev was sworn in as President of the Russian Federation yesterday (7 May) and has
fulfilled his promise to nominate Vladimir Putin as a prime minister. The Duma now has a week to
vote on Putin’s candidacy, but we have little doubt that it will vote him in as early as today. The
constitution then gives the newly appointed prime minister a week to come up with his ideas on the
composition of the government (information he is not obligated to make public).
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May 8, 2008
Razgulay Group - Strategic upgrade
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We upgrade our target price to $11.1 (from the previous $8.8, before placing it under review) and reiterate our BUY rating. Our new target price includes the value of 70,000 ha of arable land, which we expect to come under Razgulay’s ownership by YE08. We add this to the value of Razgulay’s operating business as arable land is an increasingly scarce and highly valuable asset within the global context. Not only does land ownership secure control over future cash flows and higher margins, but also gives a competitive advantage over peers, which increases in proportion to the period for which the land is cultivated.
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May 8, 2008
Research Alert: BMB Munai - Overlooked opportunity
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BMB Munai today (8 May) announced record-high April production of 4,666bpd, achieved mid-month. Average April production of 3,714bpd is about 68% up MoM, and 51% better than the company’s average production in 1Q08, on our estimates. The increase in production resulted primarily from good production rates at the newly drilled Kariman-6 and Kariman-7 wells. With two more Kariman wells (Kariman-8 and Kariman-10) set to be drilled this year, we expect BMB Munai’s eyecatching growth trend to continue.
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May 8, 2008
Research Alert: Electricity distribution - Privatisations cancelled
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Privatisation cancelled. Valentina Semenyuk-Samsonenko, Head of the
State Property Fund of Ukraine (SPFU), has issued a decree cancelling the
auctions (previously scheduled between May 14 and May 29 this year) of
blocking stakes in six electricity distribution companies: Poltavaoblenergo
(POON), Lvovoblenergo (LVON), Prikarpattiaoblenergo (PREN),
Chernigovoblenergo (CHEON), Sumyoblenergo (SOEN) and Odessaoblenergo
(ODEN). It is not yet clear what legal force the statement has.
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May 8, 2008
The hrivnya: Buy, make money and run
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The policy choice in today’s Ukraine seems particularly tough, with both inflation and the current account deficit rapidly spinning out of control.
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May 8, 2008
X5 Retail Group: размещение ГДР завершено
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Компания X5 Retail Group успешно завершила размещение 1 684 704 ГДР, не востребованных по праву преимущественного выкупа, а также еще 3 769 113 ГДР в виде казначейских акций по USD35.
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May 8, 2008
Астарта-Киев: не только производство сахара
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На основе оценки по методу ДДП теоретическая цена по акциям компании Астарта-Киев составляет EUR17.5, что предполагает наличие потенциала роста на 23%.
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May 8, 2008
Балтика: результаты за первый квартал
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Результаты Балтики за январь-март 2008 г. превзошли наши ожидания: чистая прибыль оказалась на 13% выше нашего прогноза, EBITDA – на 1.3%, а выручка – на 4.8%.
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May 8, 2008
Гривна: carry trade на час
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Снижающиеся, но все еще высокие ставки украинского денежного рынка предоставляют интересные возможности для осуществления стратегии carry trade путем покупки ликвидных внутренних обязательств.
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May 8, 2008
Группа компаний Кернел: лидер рынка агроторговли
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Группа компаний Кернел – лидер украинского экспортного рынка зерна и подсолнечного масла. Среди ее непосредственных конкурентов такие ведущие международные компании, как Cargill, Bunge и Toepfer.
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May 8, 2008
Группа Разгуляй: повышение теоретической цены
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Мы повышаем теоретическую цену по акциям Группы Разгуляй c USD8.8 до USD11.1 и подтверждаем рекомендацию ПОКУПКА.
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May 8, 2008
Группа Черкизово: размещено 3.5 млн новых акций
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Группа Черкизово привлекла USD82.25 млн путем размещения 3.5 млн новых обыкновенных акций (которые будут включены в котировальный список РТС).
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May 8, 2008
Инаугурация президента Д. Медведева – что дальше?
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Ревальвации рубля к корзине валют в ближайшее время не произойдет.
Возможно повышение суверенного рейтинга России агентством Moody’s, а во втором полугодии – агентством S&P.
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May 8, 2008
Индекс MSCI Russia: итоги последней ребалансировки
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Компания MSCI Barra объявила результаты ежегодной ребалансировки индексов. Наиболее значимым для российского рынка стало включение акций Уралкалия в расчет MSCI Russia и MSCI EM с весами 2.2% и примерно 0.2% соответственно.
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May 8, 2008
Украинские облэнерго – приватизация отменена
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Глава ФГИ Украины В. Семенюк-Самсоненко выпустила постановление, отменяющее аукционы по приватизации блокирующих пакетов акций шести электрораспределительных
компаний.
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May 7, 2008
Kernel Group: Agroplay - Sunflower oil and land
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The largest domestic soft commodities trader in Ukraine. Kernel is the leading domestic exporter of grains and sunflower oil, competing directly with the major internationals like Cargill, Bunge and Toepfer. Its assets include the biggest privately owned silo network in Ukraine with 25 silos in the key regions in which grains are sourced, and 1.7mn tonnes of storage capacity that has been modernised over the past few years.
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May 7, 2008
RC African equity indices: Weekly monitor
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Performance: Over 28 Apr – 2 May, all RC African indexes were flat or down. The RC SSA-50 Index rose 1.41% (YtD +3.35%), the RC NG-20 was down 0.29% (YtD –0.85%), the RC NG Bk-10 was flat at 0.06% (YtD +0.92%) and the RC NG nFi-10 was down 3.05% (YtD +1.29%). Performances of the EM benchmark indices last week: MSCI BRIC was up 3.06% (YtD –4.69%), MSCI EM rose 1.55% (YtD –3.06%) and the S&P New Frontier 150 NTR increased 1.92% (YtD +0.78%).
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May 7, 2008
Research alert: Baltika - 1Q08 IFRS results review
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Baltika reported better 1Q08 IFRS results than we expected today: earnings were 13% above our forecast; EBITDA 1.3% higher and revenue 4.8% above, while all the trends we expected to see – beer market growth slowdown and adverse raw material price dynamics – were fully apparent.
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May 7, 2008
Research Alert: Cherkizovo - 3.5mn new local shares placed
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Cherkizovo has raised $82.25mn (gross) from the placement of 3.5mn new local shares (to be listed on RTS), of which 14% were placed among existing shareholders (meaning that about 50% of minorities executed their pre-emptive rights). After the placement, the free float increased from 27.8% to 33.6%. (The Babaev family, Cherkizovo’s controlling shareholder, did not participate in the placement.)
Our view on the placement is mixed.
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May 7, 2008
Research Alert: Government approves final stage of power sector reform
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On 5 May, Reuters reported that the Russian government had approved an outline plan for electricity sector reform over 2008-2010. The sector currently operates on the basis of a so-called interim model. According to the outline plan, final models for wholesale and retail electricity markets will not be developed until 1Q10.
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May 7, 2008
Research Alert: MSCI Russia Index - May rebalancing results
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MSCI has announced the results of its annual rebalancing index review. The biggest change for Russia is the inclusion of Uralkali stock, with a 2.2% weighting in the MSCI Russia Index and an approximate 0.2% weighting in the MSCI EM Index. Uralkali has been included with a free float factor of 35%, and a dollar free float of $7.8bn. The MSCI includes MICEX-traded Uralkali shares for daily calculation.
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