WOOD Flash – Sberbank: June RAS results – 2Q20 read-across positive, but unlikely to tip the balance
This morning (8 July), Sberbank reported RUB 62bn in June 2020 RAS net income. Our general read-across from the 2Q20 RAS numbers to IFRS is positive, and we see upside risk for our 2020E numbers. That said, arguably, we are not out of the woods yet in terms of COR, given the increase in corporate restructurings. We also believe that the NIM is likely to get weaker down the line, and the bank may set a high C/I base for itself in 2020E. The RAS numbers still do not tip the balance for us, if we think about the intrinsic valuation. At peak next year P/E and 1x P/TBV, we believe that the stock is not attractively valued. We rate the Sber commons a HOLD. The stock is trading at 6.1x P/E and 1.0x P/TBV, on our 2021E numbers (please see our most recent report for further details).Sberbank Russia is an open joint stock commercial bank. Co.'s principal business activity is corporate and retail banking. This includes, but is not limited to, deposit taking and commercial lending in freely convertible currencies, local currencies of countries where the subsidiary banks operate and in Russian Roubles, support of clients' export/import transactions, foreign exchange, securities trading, and trading in derivative financial instruments. Co.'s operations are conducted in both Russian and international markets. As of Dec 31 2014, Co. had total assets of RUB25.20 trillion.
WOOD & Company is the leading investment bank in Emerging Europe. Founded in 1991 and head-quartered in Prague, our footprint spans the region and touches investors around the globe.
A pioneer in Emerging Europe, WOOD executed many of the first CEE equity trades and landmark investment banking transactions. Our electronic trading platform was the first in the region, and remains the best. We are continually expanding our relevance and reach in these ever-evolving markets.
Our equity market share reflects our stature: 7% in Warsaw, 20% in Bucharest, 16% in Hungary, 40% in Prague and 5% in Vienna. Our distribution is unparalleled, with the largest salesforce in the region, servicing a uniquely diverse investor base.
We couple local expertise with a truly international perspective. With offices on the ground in the region, and in key financial hubs such as London and Milano, we are never far from our clients and we remain at the forefront of what’s afoot in the CEE emerging and frontier landscape.
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