Page 143 - RusRPTApr23

together with Alexei Garyunov), entered into a partnership with this Indian holding. Ashika Group has been working with Finsight Ventures for the previous four years, so it has decided to join forces in a new joint fund format, said Ashika CEO Chirag Jain, quoted in a joint release with Finam. Vedomosti sent a request to Ashika Group.
BCS increased its TP on oil producer Lukoil 42% to Rb6,100/sh and upgrade it to BUY. The two risks we highlighted in our previous Strategy — a weak outlook for 2023e dividends and the possible loss of the ISAB refinery — have both flipped to strengths, while higher output and a weaker ruble boost earnings estimates
Cautiously optimistic on S-T outlook for Russian oil business. EU and G7 embargoes and price caps have not been as negative analysts feared, and tax changes, a production cut, and growing shadow fleet may compress Urals discounts noticeably. BCS still expect output and the Urals discount to recover to November 2022 levels by end-2023, and regain near pre-crisis levels in the L-T.
8.5 Fixed income
Foreign portfolio and bond investors also have billions of dollar’s worth of securities trapped in Russia since war started over a year ago and the Central Bank of Russia (CBR) imposed stricter capital controls.
Bond traders have been especially hard hit as most international traders were overweight Russian Finance Ministry’s OFZ treasury bills which were paying a hansom 6%-plus yield at a time when global interest rates in most major economies had been cut to near-zero. Those yields rose in 2021 as tensions escalated to over 9% as many traders rejected the idea that Russia could launch a war in Ukraine. After the war began on February 24 they now find themselves trapped in the market.
Nevertheless, foreign investors from “friendly” countries have already been given permission to buy and sell OFZ again, providing a route for some to exit.
The share of foreign investors holding OFZ peaked in March 2020 when they held 34.9% (RUB3,2 trillion) of the outstanding bonds, but that share started to fall as tension mounted in the next two years: in February 2021 foreigners share of the bonds had fallen to 17.8% (RUB2.8 trillion) at a time when the volume of issued bonds had almost doubled over the preceding two years to a total of RUB15.6 trillion OFZ outstanding.
The CBR has suspended its regular reporting of bond auction results, but now says the share of foreign investments in the federal OFZ bonds edged down to 9.7% as of March 1, 2023 from 9.9% as of February 1, 2023.
143 RUSSIA Country Report Russia April 2023 www.intellinews.com