Page 81 - RusRPTAug20

9.1.3​ Aviation sector news
A 53% y/y traffic decline is what the Ministry of Transportation expects for the Russian airline industry in 2020​. The Russian airlines association, AEVT, says that this could be better if international flights resume this year. We note that 1H20 traffic decreased 52% y/y. In the first nine days of July, we have seen a 50-55% y/y fall in daily PAX. This implies that for a 53% y/y decline in 2020, traffic from July would have to stop recovering any further, which we see as an overly conservative assumption. Moreover, such a forecast assumes no international traffic until the end of the year. Rosaviatsia is working on the latter issue, negotiating with other countries on bilateral resumptions of flights. Hungary has already responded that it is ready to resume flights from 15 July. All in all, our base case assumes a 35-40% traffic decline in 2020.
9.1.4 ​Construction & Real estate sector news
Rosstat has reported 2Q20 completions, which corrected 21% y/y to 12mn sqm​. During the quarter, the sector saw unprecedented operational conditions, and we link declining volumes to the operational breaks from closed construction sites and sales offices, lower business activity, uncertain near-term sales with downside risks to the pipeline, and a slower approval process for completed estates. The Moscow Metropolitan Area places tighter lockdowns and underperformed with 2Q20 decline of 18% while still remaining flagship market for the country with 17% contributio
Commercial real estate investment in Russia in 2Q20 dropped to $491mn, which was the lowest in 12 years​, Reuters reported on July 2 citing the study by JLL. In 6M20 overall the volume of investment deals in Russian real estate
81​ RUSSIA Country Report​ August 2020 ​ ​www.intellinews.com