Page 149 - RusRPTJan21

domestic market will recover to the 2019 level and international destinations will start recovering. In terms of the blended yield, further increased competition in the domestic market and the decrease of yields on international destinations versus the current elevated levels mean that the company expects a single-digit decline in the blended yield in 2021 in ruble terms.
In terms of the cash burn, in 2Q20-3Q20 there was quite a substantial positive effect from the restructuring of leases. This effect should decrease substantially starting in 4Q20 and will reverse further in 2021, as postponed lease payments will have to be made. We calculate that in 2Q20, Aeroflot decreased its lease payments by roughly 76% y/y, from R35bn to R8bn; in 3Q20, the decrease was 50% y/y, from R31bn to R15bn. Starting in 4Q20, we would expect lease payments to recover back to R30-35bn per quarter. Nonetheless, the company's increased liquidity position following the additional share issue (R80bn), undrawn credit lines of R148bn and R57bn of PDPs to be refunded in 2021-23 provide quite robust support for the recovery.
9.2.5​ Retail corporate news
Detsky Mir​'s November sales results were up 14.8% y/y, ​implying a robust pace that was further enhanced by the upbeat Black Friday online campaign.
The e-commerce channel saw revenues more than double y/y to RUB4.4bn in November and accounted for 33% of total. Our model envisages a 12% y/y top line expansion for 4Q20F, which we leave as our base case, noting the strong comparison base from December last year. Detsky Mir’s shares have gained 11.5% this week after the announcement of the tender offer from Altus Capital capturing all the remaining upside to our 12-month TP of RUB140 and now offer an ETR of 8.5% (reflecting our 12-month dividend forecast). Thus, we downgrade our recommendation to Hold from Buy.
· November sales gained 14.8% y/y vs. 17.5% y/y in October and 13.5% y/y in 3Q20, so we see that as an upbeat performance amid tightening restrictions and incremental pressure on traffic in malls.
· Last week, the Black Friday campaign set new records online. Friday’s online orders doubled y/y to 266,000, meaning online sales of RUB1.3bn last week, i.e. more than double the weekly blended figure in 9mo20.
· The online share in the total peaked last week at 52%, while for November it was 33%. In its strategy, Detsky Mir targets its online
149 ​RUSSIA Country Report​ January 2021 www.intellinews.com