ATON MARKET PULSE: In Exporting Mode
We expect a weaker rouble towards year end, prompting us to prefer export-oriented names vs domestic plays. We therefore favour Rosneft and Novatek as our picks in the O&G segment, as they combine potential triggers with technical underperformance. In the M&M space our favourites are Alrosa on the weaker RUB and good dividends (RU8.9DPS) and MMK on valuation and a general steel sector recovery. In utilities we maintain our bullish view on Unipro and Enel Russia: both are good dividend plays and Enel Russia is entering new capacity projects in the renewable space. Sberbank remains attractive on valuation, while TCS still offers a compelling growth story in finance. Among domestic plays we also like Globaltrans, benefiting from macro recovery, and Etalon, giving the best exposure to a low interest rate environment. The dividend season is in full swing with cut-off dates for the vast majority of names in July. We recommend focusing on Aeroflot, Alrosa, Federal Grid Company and MegaFon as the most attractive imminent dividend plays. Historically, Russian companies have tended to quickly recover their ex-dividend gaps after the cut-off date. Finally, we introduce three pair trade ideas in the M&M, gas and finance sectors.
Since its inception in 1991, ATON has built a reputation for combining in-depth local knowledge of the Russian market with the highest international standards in research, sales and trade execution. As a result, we have been able to attract many of the leading domestic and international institutional fund management groups as our clients. As one of the leading independent investment banks in Russia, we offer the full range of institutional brokerage service, including:
- Detailed fundamental analysis of economics, sectors and companies, with the widest coverage universe in Russia and the CIS;
- Timely trading ideas to help clients take advantage from short-term pricing discrepancies;
- Competitive prices and prompt execution of trades;
- An on-line platform providing easy access to all our research products and tools.
- Client-focused Service
- We employ state-of-the art technology to ensure the highest quality of investment services as well as the highest level of data protection.
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