Page 12 - RusRPTFeb23

On top of the crash in share prices, a number of companies refused to pay dividends, which also led to a reduction in the yield of securities for investors.
The annual returns from Moscow exchange index since the beginning of the year has been approximately minus 40% BCS GM reports. This is the worst indicator since 2008 index fell by 60%.
The maximum drop was observed in companies that suspended the payment of dividends, lead by Russian banks, which Central Bank advised to cancel distributing profits by dividends.
For example the shares of state-owned VTB fell by 66% over the year and its sister bank Sberbank which was down by 52%.
In addition, there was a significant drop in technology companies. The shares of leading employment agency HeadHunter fell by 69% and tech giant Yandex plunged by 60%. National airline Aeroflot was down 58% and gold miner Polymetal by 72%.
The shares of companies that earn the majority of their revenue in the domestic market turned out to be more stable. Supermarket giant Magnit saw it shares tumble by only 20%, while leading mobile phone company MTS took a 21% hit. The shares of fixed line operator Rostelecom were down by 35%.
A few shares even gain in value. Fertiliser maker PhosAgro saw its shares rise by 7%, as fertilisers have been exempted from sanctions as part of the efforts to avoid a global food crisis.
Liquid and in profit, PhosAgro continued to pay dividends, and global fertiliser prices rallied on the warnings of a food crisis making these shares something of a safe haven.
2.4 Russia’s central bank to sell yuan, as changes budget rule to trigger on oil and gas revenues not oil prices
Starting on January 13 the Central Bank of Russia (CBR) will reintroduce the budget rule and resume sales of foreign exchange to the market, but in yuan not dollars, to bring in new cash and compensate for a sanctions-related fall in oil and gas revenues.
The ruble immediately reacted to the news and strengthened by a whole ruble to RUB68.5 on January 11. As followed bne IntelliNews, the ruble weakened significantly in December, but recently has begun to strengthen against the dollar as the new year gets under way.
“The beginning of the year promises to be traditionally comfortable for the foreign exchange market, taking into account the seasonal failure of imports and high supply of foreign currency with low demand, so that the Ministry of Finance and the Central Bank will be able to test the new mechanism,” The
12 RUSSIA Country Report February 2023 www.intellinews.com