Tellimer provides an integrated suite of services focused on the world's developing markets. It offers world class investment research and local insights; end-to-end content distribution and analytics; market execution and corporate access; brokerage services across Fixed Income and Equities; and expert advisory services.

Tellimer is headquartered in London, UK, with additional offices in Dubai, Lagos, Nairobi, New York and Singapore. It is a division of Exotix Partners LLP.

Anna Kurbatova

Yandex and Sberbank close to divorce – negative for YNDX, neutral for SBER

Yandex (YNDX US, O/W, TP $48.3) and Sberbank (U/R) are reportedly preparing a deal on separation of their jointly owned Internet assets Yandex.Market and Yandex.Money. Yandex is likely to purchase a 45% share in Yandex.Market from Sberbank for cash (and thus consolidate 90% stake), while Sberbank will get 100% in Yandex.Money. Yandex may also announce a secondary offer up to 5% Class A shares to the market. The divorce news is not surprising for us or the market, as speculations about disagre...

Gbemisola Ogungbade ...
  • Nkemdilim Nwadialor

Ghana: Digital payments pick up; central bank confident this is a "new normal"

At the May Monetary Policy Committee (MPC) meeting in Accra, the Governor of the BoG, Dr Ernest Addison, noted that the 3-week lockdown, which resulted in the absence of physical banking and physical payment systems in the country (as cash transactions are a possible conduit for the spread of COVID-19) resulted in an increase in the volume of digital payments in the first quarter of the year. Digital payments that are captured by the Ghana Interbank Payment and Settlement Systems (GhIPSS) saw...

Diyar Hozaien

Juhayna: Meet the management webinar – key takeaways

Off to a Strong Start, Positive Outlook throughout 2Q20 * 2Q20 follows the notable growth recorded in March on the back of panic-induced overstocking by customers, especially evident in the Dairy segment and multi-serve products. The beginning of the 2nd quarter coincided with the Ramadan season, which entails peak volumes for the high-margin Yogurt segment, whereas Juice and single-serve products have been hit by the closure of schools and lower traffic to smaller grocery shops and kiosks. ...

Hasnain Malik

Philippines: Balancing US and China as end of US forces deal delayed

ABROGATION OF US MILITARY AGREEMENT SUSPENDED The Visiting Forces Agreement (1999) between the Philippines and the US establishes a legal framework for the presence of US troops and the conduct of joint military exercises. In mid-February 2020, President Duterte gave notice that the agreement would be scrapped in mid-August. On 2 June, Foreign Affairs Secretary Locsin Jr announced the termination would be delayed by six months to a year. WALKING THE US-CHINA TIGHTROPE The wider context of thi...

Faith Mwangi

Absa Kenya: Q1 20: Earnings hit by loan loss charges and separation costs; downgrade to Hold

ABSA Kenya (formerly Barclays Bank; Hold, TP KES12.50) has released its Q1 20 results, with EPS rising 3% yoy. Before provisions, earnings were positive, with pre-provision income growing 24% yoy. The bank’s FX income jumped 47% yoy. We believe this was from big-ticket deals the bank had within the quarter – they are unlikely to recur in coming quarters. Operating expenses declined 5% yoy, with the bank currently focusing on reducing costs after cutting branches in 2019. The main current cos...

Stuart Culverhouse

2018 Fixed Income Frontier Outlook

We cannot recall EM and frontier markets beginning a year with so much positive sentiment – we would probably need to go back to before the global financial crisis, perhaps longer still. This comes after 2017 likely saw the first positive global growth surprise in seven years, despite the onset of the withdrawal of global monetary stimulus, and we think this momentum looks set to continue into 2018.

Nirgunan Tiruchelvam

Which of the Baby Amazons will survive?

E-commerce is in the ascendancy in emerging markets, having grown by an estimated 18% per annum over the past five years.

Walid Khalid Bamhair

Saudi Arabia (NCB Capital): FTSE Russell – Saudi implementation phase

On 18 March 2019, FTSE Russell will begin the implementation of the inclusion of Saudi Arabia into the FTSE index series. Saudi Arabia is projected to have a weight of 2.9% in the FTSE Emerging All Cap index and 0.30% in the FTSE Global Equity index. Saudi’s addition to the FTSE Emerging All Cap index is expected to result in a total inflow of cSAR21.7bn mainly from passive funds benchmarked to the index. The implementation will occur in five tranches with the first tranche representing 10% of total inflows equivalent to SAR2.17bn. We expect the Saudi market to continue its positive momentum s...

Rahul Shah ...
  • Rohit Kumar

Global remittances: Opportunities and risks in an industry upended by Covid-19

International remittances totalled US$714bn in 2019, sent by 272mn migrant workers. We think a further cUS$500mn was sent via informal channels. The largest source markets for remittances are the US, UAE and Saudi Arabia. Key recipient markets include India, China and Mexico. But this industry is changing fast, disrupted by new technologies and the economic impact of Covid-19. Remittance volumes could decline 20% in 2020, according to the World Bank. Key drivers of this decline include negati...

Rahul Shah

Could fungal warfare finally defeat malaria?

While the world currently battles to lower the incidence of Covid-19, prospects for reducing the transmission of a far deadlier disease, malaria, may have improved. Any progress in this area could prove particularly beneficial for sub-Saharan Africa. There are over 200mn incidents of malaria each year Annually, the disease kills c400k people every year, making it one of the deadliest transmittable diseases. This is particularly the case for infants – globally it is the fifth most common cause...

Duncan Wales

Work life after Covid-19: The new normal is tech-enabled

The sun shines, the shop shelves are full – albeit the shoppers themselves are socially distanced and strangely silent – and yet we collectively stand on the brink of the unknown. It is not so much the changes that we can already see as the consequence of the first truly global event in human history that occupy our thoughts; it is the changes yet to come that pose the real questions. Great events are occurring, the chess pieces are moving, the world will not go back to the way it was. Yet we...

Nkemdilim Nwadialor ...
  • Rahul Shah
  • Rohit Kumar

Africa's fintech hubs: The search for tomorrow's Silicon Valley

The four main fintech hubs in Africa are Egypt, Kenya, Nigeria and South Africa. These markets have distinguished themselves from the rest of Africa through their support for innovation (for example, via regulatory sandboxes) and the widespread establishment of strategic partnerships (such as Nigerian fintech, Paga's partnership with WorldRemit for international remittances). As a result, these centres have to date attracted the lion’s share of the investment capital deployed across the conti...

Nkemdilim Nwadialor ...
  • Rahul Shah
  • Rohit Kumar

Africa fintechs’ product suite explained… from agritech to remittances

Our recent survey of 150+ fintechs across 20 African markets enabled us to find their product and customer niches, as well as identify theirunique success factors. Fintech companies are increasingly competing with traditional financial services providers, by structuring their offerings in innovative and more efficient ways.These companies often help to widen the financial inclusion net using models such as branchless distribution, mobile banking, big data credit scoring and machine-to-machine...

Anna Kurbatova

Yandex and Sberbank close to divorce – negative for YNDX, neutral for SBER

Yandex (YNDX US, O/W, TP $48.3) and Sberbank (U/R) are reportedly preparing a deal on separation of their jointly owned Internet assets Yandex.Market and Yandex.Money. Yandex is likely to purchase a 45% share in Yandex.Market from Sberbank for cash (and thus consolidate 90% stake), while Sberbank will get 100% in Yandex.Money. Yandex may also announce a secondary offer up to 5% Class A shares to the market. The divorce news is not surprising for us or the market, as speculations about disagre...

Gbemisola Ogungbade ...
  • Nkemdilim Nwadialor

Ghana: Digital payments pick up; central bank confident this is a "new normal"

At the May Monetary Policy Committee (MPC) meeting in Accra, the Governor of the BoG, Dr Ernest Addison, noted that the 3-week lockdown, which resulted in the absence of physical banking and physical payment systems in the country (as cash transactions are a possible conduit for the spread of COVID-19) resulted in an increase in the volume of digital payments in the first quarter of the year. Digital payments that are captured by the Ghana Interbank Payment and Settlement Systems (GhIPSS) saw...

Diyar Hozaien

Juhayna: Meet the management webinar – key takeaways

Off to a Strong Start, Positive Outlook throughout 2Q20 * 2Q20 follows the notable growth recorded in March on the back of panic-induced overstocking by customers, especially evident in the Dairy segment and multi-serve products. The beginning of the 2nd quarter coincided with the Ramadan season, which entails peak volumes for the high-margin Yogurt segment, whereas Juice and single-serve products have been hit by the closure of schools and lower traffic to smaller grocery shops and kiosks. ...

Hasnain Malik

Philippines: Balancing US and China as end of US forces deal delayed

ABROGATION OF US MILITARY AGREEMENT SUSPENDED The Visiting Forces Agreement (1999) between the Philippines and the US establishes a legal framework for the presence of US troops and the conduct of joint military exercises. In mid-February 2020, President Duterte gave notice that the agreement would be scrapped in mid-August. On 2 June, Foreign Affairs Secretary Locsin Jr announced the termination would be delayed by six months to a year. WALKING THE US-CHINA TIGHTROPE The wider context of thi...

Yusra Beg

Pakistan inflation: CPI remains close to 8% in May 2020

Pakistan's National CPI inched lower to 8.2% yoy for May 2020 vs. 8.5% yoy in April. Urban CPI decelerated to 7.3% yoy vs. 7.7% in April while Rural CPI remained sticky at 9.7% yoy vs. 9.8% yoy in April. This takes the 11-month National CPI average to 11.0%. Both Urban and Rural Core inflation crept lower to 5.4% yoy and 6.4% yoy (vs. 6.2% yoy and 7.4% yoy respectively in the previous month). A sharp rise in potato, pulses and wheat product prices was countered by decline in prices for tomato...

Faith Mwangi

Absa Kenya: Q1 20: Earnings hit by loan loss charges and separation costs; downgrade to Hold

ABSA Kenya (formerly Barclays Bank; Hold, TP KES12.50) has released its Q1 20 results, with EPS rising 3% yoy. Before provisions, earnings were positive, with pre-provision income growing 24% yoy. The bank’s FX income jumped 47% yoy. We believe this was from big-ticket deals the bank had within the quarter – they are unlikely to recur in coming quarters. Operating expenses declined 5% yoy, with the bank currently focusing on reducing costs after cutting branches in 2019. The main current cos...

Evgeniy Kipnis

VTB Bank: April and 4M 20 IFRS results – neutral-to-positive

VTB (U/R) reported its April 2020 financials. The bottom line was under pressure from an F&C drop, non-core losses and credit loss provisions. At the same time, NIM resiliency (supported by cheaper funding) helped the bank to remain P&L-positive. Provisioning in April was not materially higher than in 1Q20, which is a good news, but on the other hand might suggest less degree of conservativeness vs Sberbank. We still might see further pick-up in coming months, while the scale of credit losses...

Nirgunan Tiruchelvam

JDE Peet's frothy IPO underlines value in Nestle Nigeria and Unilever Nigeria

The sleepy IPO market just received an espresso shot. Amidst the doom and gloom, JDE Peet's raised US$2.5bn last week, in Europe's biggest IPO since 2018. It was also the first major listing that was conducted entirely in the brave new world of Zoom calls. The deal is extraordinary in that Covid-19 did not dent its prospects. On the contrary, the issuers actually rushed the deal forward to benefit from the post-March stock market rally. The IPO process was reduced from four weeks to 10 days d...

Joy Bhattacharjee ...
  • Tanay Roy

Berger Paints Bangladesh: Cheap oil boosts margin, growth drivers intact in post-Covid – Initiate with Buy

We initiate coverage of Berger Paints Bangladesh (BRGR BD) with a Buy recommendation and a target price of BDT1576 for December 2021, suggesting ETR of 22.9%. Berger Paints Bangladesh is the leading paint, construction chemical, adhesive, and coating manufacturer in Bangladesh with a 50% market share.The company derives 60% revenue from its decorative & industrial paint segment, and the rest 40% from construction chemicals (15%), coatings (15%) & adhesives (10%). BRGR BD has two factories in ...

Abdul Ghani Mianoor

Honda Atlas: 4QMY20 results: Lower gross margins led to quarterly loss; below expectations

HCAR reported a loss of PKR28mn (LPS: PKR0.20) for 4QMY20, vs. a profit of PKR1,169mn (EPS: PKR8.18) same period last year. The result has underperformed our expected EPS of PKR2.14, due to lower-than-estimated gross margins. This took MY20 NPAT to PKR1,547mn (EPS: PKR4.77), down 82%yoy. The company announced a final dividend of PKR1.0/sh, better than our expectation of no dividend. 4QMY20 Result highlights include: Revenue of PKR15.7bn, down 35% yoy due to 49% yoy decline in unit sales, whi...

Kiti Pantskhava

Kernel: Upbeat Q1 20, but bond spreads already tight; reiterate Hold

Reiterate Hold. After the Covid-19 pandemic-driven sell-off in the Ukrainian bond market, KERPW took some time to gain momentum, but recently both the KERPW 22s and KERPW 24s have largely pared its losses, with KERPW 24s tightening their z-spread over MHPSA 24s to c25bps. The pre-sell-off spread was near zero, so there could be room for more tightening, particularly as MHP is likely to see a weak Q2 20 affected by the coronavirus outbreak. Kernel, on the other hand, is approaching the financi...

Stuart Culverhouse

Argentina's debt restructuring: Mind the gap

Both sides, the government and certain bondholders, presented revised terms last week as negotiations continue ahead of the 2 June extended deadline for the exchange offer. Symbolically, two of the bondholder groups, the Ad Hoc group and the Exchange Bondholders, presented a joint debt proposal, which was subsequently made public. There has been a bit of convergence in their positions. Our modelling suggests the gap between the two sides has narrowed a bit, although more from the government's...

Kiti Pantskhava

Koç Holding: Q1 20 – Continuing to show resilience, Hold

Reiterating Hold.Koç Holding reported Q1 20 results, demonstrating persistently strong liquidity despite debt repayment and the acquisition of an additional stake in Yapi Kredi. While the sell-off in Turkish equities and TRY depreciation reduced the market cap of Koç Holding’s companies, we estimate that the value of the holdco’s investments covers its debt by a ratio of 3.8:1. Both the holdco and its key subsidiaries have accumulated sufficient liquidity ahead of the pandemic-inflicted slowd...

Stuart Culverhouse

Emerging Market sovereign bond issuance eases in May

EM hard currency sovereign bond issuance eased back in the month of May after its April rebound. We estimate EM sovereign bond issuance was US$18.7bn last month, bringing total issuance YTD to US$102.7bn. But monthly issuance was well down on the US$43.5bn issuance in April, which marked a return after a two-month lull due to the impact of coronavirus. Figure 1: EM hard currency sovereign bond issuance YTD by month* (US$bn) [-eu-west-1.amazonaws.com/exotix-content-uploads/jufUSangvo...

Muhammad Saad Ali

Pakistan's KSE-100 in May: Muted performance despite positive triggers

The KSE-100 was flat in May 2020 (down 0.5% mom), taking CY20td decline to 17%. There were some positive triggers, including the partial lifting of lockdown conditions by the government and the SBP cutting the policy rate further by 100bps to 8%. However, both failed to lift market sentiment. Market activity fell 9% mom to c.US$46mn average daily traded value. FIPI outflow (US$40mn in May) continued for the fourth consecutive month since the onset of Covid-19 pandemic. International oil price...

Lakshini Fernando

Sri Lanka (Asia Securities): New president appoints interim cabinet; positive for policy direction

Sri Lanka’s newly-elected President Gotabaya Rajapaksa appointed an interim caretaker cabinet consisting of 16 members today. This followed his appointment of ex-President Mahinda Rajapaksa as the prime minister. In addition to his post as PM, Mahinda Rajapaksa was sworn in as 1) Minister of Finance, 2) Economic affairs and policy development, 3) Buddhist affairs, 4) Cultural, 5) water supply and urban development, and 6) housing development. We believe the smooth transfer of power from the previous UNP administration is a key positive to establish stability soon after the presidential electio...

Takudzwa Sherekete

Zimbabwe (IH Securities): Strategy – economic headwinds to persist

The 2020 Budget attempts to solve the underlying problem of productivity through several measures, the main lever of which is the increase in tax-free thresholds to release more disposable income from consumers. Our concern is that prevailing economic headwinds including elevated inflation will in the short term continue to outpace consumer earnings especially as corporate employers remain under significant pressure.

Muhammad Saad Ali ...
  • Raza Jafri

Pakistan (IMS): Market Strategy – a U-shaped recovery

We recently met with a group of key government officials and major corporates in Pakistan. Most companies retain a cautious outlook on volumes (over the next 12-18 months), but acknowledge the macro improvement and bottoming out of corporate profitability. The ongoing protests in Islamabad were given short shrift.

Sandy Eskaros

Egypt (Pharos): Inflation Monitor – October inflation hits record low

Inflation in October 2019 fell to its lowest level since January 2007; hitting 2.4% YoY for total Egypt against 4.3% in September, enforcing the single digit inflation trend further and faster than expected, as it has been decelerating further every month since May 2019. Annually, the highest growing category was Education, growing at 28.5% YoY followed by Recreation & Culture as well as Transportation, both growing at 15.7% YoY in October. Worthy of attention is the Food & Beverages category recording a decline for the second consecutive month at -6.3% YoY in October compared to -0.06% YoY i...

Kavinda Perera ...
  • Lakshini Fernando

Sri Lanka (Asia Securities): Voting for a change, but which way?

The 2019 elections will see 15.8mn voters (including 1mn new voters) polling to elect the 8th President of Sri Lanka. Overall, we note the election will be a closely contested and 1) events in the last week before the elections could shift the floating voter base, 2) higher voter participation in North and East will be critical for Sajith and 3) Gotabaya needs to attract ~68% of the ethnic majority – Sinhala voter base for a win.

Alfa Equity Team

Russia (Alfa): Morning Bulletin – 22 November 2019

Russia likely to shrug off external noise and advance further. The Russian market recovered on Thursday – RTSI (+0.4% @ 1,454) and IMOEX (+0.2% @ 2,942) – driven largely by domestic corporate events. The ruble finally found traction after being rangebound for most of this week (+0.3% @ 63.72). The oil price slipped slightly lower (Brent -0.5% @ 63.65) after the recent gains. Elsewhere, European markets closed lower (StoxxEuro600 +0.2%) on geopolitical worries. Overnight, US markets conceded ground – Dow Jones (-0.2%) and S&P 500 (-0.1%). Asian equity markets this morning have made a slight rec...

Muhammad Saad Ali

Pakistan (IMS): KSE-100: First positive monthly return in 8 months

KSE-100 rebounded in Sep’19, rising 8% mom, after seven consecutive months of decline (CYTD return -13%). This was led by a status-quo monetary policy and an ensuing decline in money market rates (in longer tenure). Market activity also picked up 11% mom to US$29mn average daily traded value. FIPI remained moderately negative (US$3.5mn outflow), while local mutual funds selling slowed down considerably.

Muhammad Saad Ali

Pakistan (IMS): Market overview – Tax credits and one-offs veiled weak 2QCY18 results

Today's Intermarket Pulse focuses on the Pakistan market performance, in addition to our daily snapshot of the Pakistan stock market including volumes, yield vs spread, and portfolio flows.

PAKISTAN: Don't wait for the IMF deal

Exotix Pakistan Universe stocks have already rallied 5% (11% in US$-terms) since the general election on 25 July that resulted in Imran Khan’s PTI coming close to an absolute parliamentary majority – a result which exceeded expectations (read our recent note on the Pakistan Election). We think that the downside risks (such as weaker PKR and political uncertainty) are already priced into equities as the KSE100 Index is on a 14% discount to its 5-year average P/BV of 1.5x.

SRI LANKA BANKS: Q2 18 preview: asset quality deterioration to continue; upgrade HNB to Buy and NDB to Hold

We maintain our cautious stance on Sri Lanka banks. Valuations are cheap, with 2018f PB at 0.8x, but the discount is justified in our view as we expect sector profitability to come under pressure in 2019.

Stuart Culverhouse

Argentina: No easy option to avoid another (currency) crisis

The Argentinian Peso (ARS) fell to 61/US$ in early trading (down 26% from Friday's close), but has since recovered a bit to 55. It looks like the authorities have not intervened too much this morning, by letting the currency fall as far as it has. Why resist that pressure? But it is a difficult, if not impossible, job for them now. The central bank has some ammunition, but probably not enough if it keeps on like this.

Olabisi Ayodeji

Nigeria Tier 1 Banks: Looking to the rest of Africa for growth

The ‘rest-of-Africa’ segment is making a rising contribution to the group-level growth and profitability of Tier 1 Nigeria banks. We think this should serve as a medium-term tailwind considering challenges in Nigeria. Our top pick on this theme is Zenith, and Nigeria Tier 1 banks generally are at an attractive discount to Africa peers.

Rahul Shah CFA

FM & SMALL EM: Gaining FX protection through banks

Some banks offer a natural hedge against currency devaluation risk due to their net long foreign currency positions, enabling investors to gain exposure to long-term positive fundamentals (demographics, financial inclusion, institutional improvements and so on), while also providing some FX protection.

Frontier Themes: Affordability in Africa

The rise of the African consumer continues to present a significant opportunity for local and multinational consumer companies operating in the region. However, there is growing frustration among these companies over whether this opportunity will be realised, given disappointing sales growth in the region in recent years. We argue that the challenges and underwhelming performance of most of these companies is not because the opportunity does not exist, but because of their inability to adapt adequately to local nuances. In particular, that of consumer affordability, which essentially is the pr...

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