Page 16 - bne_newspaper_June_28_2019

Eastern Europe
June 28, 2019 www.intellinews.com I Page 16
Russian aluminium major Rusal on track to recovery
Russian aluminium major Rusal reported 18% year-on-year gain in export shipments in January- May 2019 to 1.44mn tonnes, the company said.
As reported by bne IntelliNews, after Rusal had the US sanctions lifted in February 2019, the company is expected to deliver solid results starting with 2Q19, and plans to tap debt markets again as
its credit ratings remained intact.
Commenting on May's recovery in export shipments, BCS Global Markets analysts said, "expect robust improvement in 2Q19 trading and financial results."
Rusal previously guided for aluminium demand to rise by 3% y/y in 2019 to 68mn tonnes versus 3.6% growth seen in 2018, while planning to restore the market position including share of value-added products sales, aiming to recover the profitability.
The company is also reportedly preparing panda bonds, domestic ruble bonds placement, and also plans to raise RUB60bn ($1bn) syndication from Russian banks to finance the Tayshet aluminium plant, the largest project of Rusal.
State to resume support for Russian car market
The Russian government will resume the support for Russian car market as of July 1 given declining demand and sales, Kommersant and Vedomosti dailies said on June 26.
As reported by bne IntelliNews, market participants believe that declining consumer confidence and incomes will drive Russian passenger and light commercial vehicle (LCV) to contract by 3-10% in 2019. Extensive state support contributed to the recovery of the passenger car and LCV market in 2017-2018, but the sales have declined for two consecutive months in April and May 2019.
The automotive market is still digesting
a substantial reduction in government subsidies stimulating retail purchases in the past, creating "a rather challenging environment," AEB wrote on the car sales declining by 7% in May.
Reportedly new support mechanisms were requested by the largest carmakers such as AvtoVaz, Renault, GAZ, Sollers, Hiundai, and Kamaz, as well as by dealers associations. The state will grant a total of RUB19bn ($301mn) to support car leases and loans, for the programs First Car, Family Car, as well discounted leasing of commercial vehicles.
The Ministry of Industry and Trade estimates that this would increase sales by an additional 75,000 vehicles in 2019.
Recent reports also claimed that the Russian car market could be shrinking faster than the industry data suggests, with a real decline in car sales at 18% in May 2019 if accounted only for actual sales by the car dealers.