Page 107 - RusRPTMar21

Standard & Poor’s (S&P) rates both Russia’s foreign debt at BBB- with stable outlook and the local debt at BBB.
S&P has also been fairly consistent on Russia’s rating. Its lowest grade was BB+ (negative) awarded in January 2015. The highest was BBB awarded in December 2008.
8.5.1 Fixed income - bond news
One of Russia’ big three e-commerce companies, Ozon Holdings continued its fund raising drive and placed a convertible bond maturing in 2026 with a coupon of 1.875% per year and a conversion premium of 42.5% above the reference price on February 17. The conversion reference price was set at $86.648 per ADS. Ozon increased the placement volume from the initially announced $650mn to $750mn due to high demand, Sova Capital reports. The company expects to issue the bonds on February 24. “As we stated in our comment yesterday on the initial announcement of the offering, we think the bond placement should give Ozon more flexibility in its capital allocation at a reasonable cost, although we do not rule out that the market could be cautious on the conversion feature. Given the conversion price, the potential dilution could be limited to around 4.2%, on our estimates,” Sova Capital’s head of research Mikhail Terentiev said in a note. “In our view, the news signals a further increase in competition in the Russian e-commerce space, which does not bode well for the e-commerce sector’s profitability pool,” Sova added. Russia’s e-commerce is booming and Ozon pulled off a hugely
107 RUSSIA Country Report March 2021 www.intellinews.com