Page 137 - RusRPTMar21

could be useful".
· Recently, Rosaviatsia proposed the creation of new lowcoster. While airlines are not considering it because of the ongoing crisis, they might return to the issue later. We think that the appearance of a regional lowcoster would generate organic growth of an underdeveloped market, and raise overall traffic, including in the Moscow hub.
9.2.5 Retail corporate news
X5 Retail Group is to create a new unit to provide financial services. It would not have a banking licence, but could cooperate with Alfa-Bank. The new unit might be lead by Kirill Dmitriev, who is currently supervising Sberbank’s payment services, writes the paper. In its updated strategy through 2023, X5 has extended a number of products to clients, complementing its core food retail with new core ecosystem attributes. The latter include a media platform, FMCG marketplace and delivery aggregator, as well as payment and subscription services. The target is for those digital services to represent 5% of revenues by 2023. We anticipate an update from the company on its future financial products, but consider closer engagement with its existing clients, and potentially attracting new ones, as supportive for the investment case. X5’s GDRs have been flat over the last three months; they now demand 2021F EV/EBITDA of 6.2x and offer a 12-month annualised dividend yield of 7%. For 2021, we model revenue growth of 9% y/y and a 7% EBITDA margin, which, in our view, is a balanced short-term outlook. Were digital services and the e-grocery channel to develop faster, that would represent an upside risk to our model and could accelerate a stock rerating.
M.Video-Eldorado posted 4Q20 Trading update and held its Strategy Day. Good results were driven by growth in the market for household appliances and electronics and the successful ramp-up of the Group’s online business, as well as efficient in-store operations under the OneRetail model.
· The Group’s GMV increased by 19% y/y to Rb164.3bn (incl. VAT)
· Total online sales rose by 101% y/y to Rb105.7bn (incl. VAT) –
64.3% of sales
· The average monthly audience of the websites rose by 11.8% y/y
to 78.9mn
· In January 2021, the Group continued to grow its GMV by more
than 20%, while also increasing the share of total online sales in overall GMV
Detsky Mir reported its 4Q20 IFRS results, which showed that EBITDA was 4% below consensus due to last quarter’s lower-than-expected gross margin. However, the FX gain, 21% y/y decline in interest expenses and
137 RUSSIA Country Report March 2021 www.intellinews.com