Page 160 - RusRPTNov21

kt. VAP sales grew 9.5% y/y, though they were down 8.1% q/q to 915 kt. The average realized aluminum price was up 55% y/y and 11.6% q/q at $2,729/tonne.
Our view: As for the power segment, electricity output growth slowed slightly (by 2 pp) in 3Q21 compared to the 2Q21 level (+15% y/y). The electricity price dynamics in the Irkutsk and Krasnoyarsk regions were weaker than in the second price zone (Siberia), where the average price was up 1.7% q/q. The company attributed this to the higher share of HPPs in the output of the two regions. All in all, we think the higher total electricity output (+5.3% q/q) should offset the negative effect from the weaker pricing, so we do not expect the financial performance of the power segment in 3Q21 to deviate much from its performance in 2Q21.
As for the metals segment, it is worth noting that the decrease in sales in 3Q21 was mostly due to capacity restrictions along domestic transport routes and global supply chain issues, rather than company-specific factors. In addition to that, the company noted that in 9m21 the global aluminum market registered a deficit of 1.1mn tonnes, while it had been close to balanced in 1H21; this contributed to the strong aluminum prices in 3Q21.
Nonetheless, over the last few days we have seen a correction in aluminum prices, which are now down around 18% from the mid-October peak and fell 3% yesterday on reports that Chinese authorities plan to take measures to rein in high resource prices. We think this is what drove the declines in the share prices of En+ (-3.9%) and Rusal (-4.8%) on the MICEX yesterday.
RusHydro reported strong 3Q21 RAS results, 28 October. RusHydro’s top line was up 11.9% YoY to RUB 49.9bn, with revenue from electricity sales up 23.2% YoY to RUB 25.6bn and revenue from capacity sales up 2% YoY to RUB 13.6bn in 3Q21. The strong top line was the result of the company’s HPPs generating more electricity in 3Q21 (+10.2% YoY), with liberalized prices up 18.9% YoY in the European part of Russia and up 6.8% YoY in Siberia during the quarter. COGS (+9.8% YoY to RUB 27bn), EBITDA (+13.5% YoY to RUB 26bn) and net income (+10.7% YoY to RUB 14.2bn) were all up in 3Q21.
On 11 October, RusHydro announced that it its auction (held in September) for green electricity supply through I-REC and bilateral contracts, consumers requested 5.5bn kWh. RusHydro received more than 20
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