Page 14 - bne_Tech_02_2021

Fintech & E-commerce
February 2021 www.intellinews.com I Page 14
BCS GM upgrade Russia's "more than just a bank" Sberbank to Buy
BCS Global Markets analysts on January 29 upgraded their recommendation on the shares of Russia's largest state-controlled bank Sberbank to Buy, with a target price of RUB330 per preferred share and RUB370 per ordinary share making a 22% and 27% estimated excess return respectively.
While Sberbank maintains its leading market position in the banking sector, the low interest rate environment is pressuring the banking business, with the focus on diversifying revenues and pushing non-banking top line to 30% of total by 2023, noted by BCS GM analysts.
"As such, we welcome Sber’s focus on higher growth industries, such as brokerage and
asset management (15% NOI CAGR 2020-23), payments (8%) as well as risk insurance (8%) and e-commerce (55%)," BCS GM writes.
Sberbank is very well positioned to realise growth potential in these highly underpenetrated markets
due to its technological advantage and client base (98mn+ retail and 2.8mn corporate clients).
"Moreover, further growth in the cashless economy should support Sber’s payments business with an estimated RUB60 trillion [$789bn] turnover by 2023 – 1.3x growth," BCS GM suggests, forecasting a 9% CAGR in 2020-2023 for net operating income of the financial businesses.
As reported by bne IntelliNews, Sberbank
has made an important addition to its digital ecosystem Sber by signing a memorandum of intent on the joint development of marketplace Goods.ru, controlled by major electronics retailer M.Video-Eldorado.
"The company sees itself as a top-3 player in e-commerce by 2023 with a RUB4 trillion market size (20% CAGR 2020-2023)," BCS GM reminds, with the name currently already having assets
in the delivery of food and grocery, restaurant delivery, as well as a pharmaceuticals asset.