Post-IPO analysis of Russian issuers

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1 Post-IPO analysis of Russian issuers As of 30 June 2015

2 This analysis contains a selection* of IPOs by Russian issuers, and therefore is not a complete list of all Russian public companies. The analysis covers post-ipo performance in the period from the date of an IPO (or from 1 January 2005 for pre 2005 IPOs) to 30 June This is our second issue of Post-IPO analysis of Russian issuers. Our first issue covered post IPO period from IPO to 31 December In this issue we also cover certain aspects of the impact of economic crisis on the Russian issuers performance. This publication contains historical data on s in stock (shares and/or depository receipts) prices, market index, liquidity and other statistical information for a selection of Russia-based listed companies. MSCI EM index MSCI Emerging Markets Index, also referred to as the market in this publication. Change in the MSCI EM index from an IPO date to 30 june 2015 for issuers that listed after 31 December For issuers listed prior to 1 January 2005, in MSCI EM index is calculated from 1 January /Average liquidity average daily traded value of a stock on all listing platforms over trailing 12 months multiplied by the number of trading days of a listing venue in the last 12 months or since IPO (for recently listed companies), divided by average market capitalisation at each month end in the last 12 months. Average = Daily traded value (Ave) Х N of trading days in the last 12 months italisation (Ave) Outperformer a stock that had a higher increase or a lower decrease in price since IPO compared to a in MSCI EM index. Underperformer a stock that had a lower increase or a higher decrease in price since IPO compared to a in MSCI EM index. price is defined as a in an issuer s stock price: a) since IPO for companies listed after 31 December 2004; b) from the first business day of 2005, for companies listed prior to 1 January 2005; or c) since a significant corporate restructuring. for dual listed companies is taken as a sum for all listing venues. *Selected issuers with market capitalisation greater than USD50 mln and available offer price, current price, trading value and other data. Information was compiled from public sources, including Bloomberg, msci.com, PREQVECA and company websites and has not been independently verified by AO PricewaterhouseCoopers Audit. PwC Post-IPO analysis of Russian issuers 2

3 Overview Outperformers At the end of 2013, 27 of 88 Russian issuers outperformed the MSCI EM index on average by 120% compared to 61 issuers who underperformed by 52% over the same period. Despite the economic crisis that began in early 2014, as of 30 June 2015, 12 out of 84 issuers have still outperformed the market by a staggering 189%. Companies in the Retail sector showed best performance with Magnit as the market leader. Oil & Gas and Technology & Communications sectors also provided positive returns to investors. +189% Only 3 IPOs were held since 31 December 2013 including: 72 issuers stock price decreased by 60% 12 issuers stock price increased by 189% Lenta US$1,095 million/ Retail/January 2014/LSE United Wagon Company US$180 million/ Transportation & Logistics/April 2015/ MOEX Credit Bank of Moscow* US$238 million/ Financial Services/ June 2015/MOEX -60% Underperformers *Excluded from analysis, as IPO was completed on 30 June PwC Post-IPO analysis of Russian issuers 3

4 Sector analysis Average in stock price compared to in the MSCI EM index for the same period 100% 50% 0% (50%) (100%) (150%) Transportation & Logistics 6 Utilities Food & Beverage Retail 6 Real Estate 15 Metals & Mining Oil & Gas Best performing sectors and companies remain largely und from December 2013 to June Magnit, EPAM and Novatek are the best in their industries and top-3 outperformers Financial services Technology & Communications Average liquidity Only sectors with more than 5 issuers are included in the analysis above - number of companies (outperformers) - number of companies (underperformers) PwC Post-IPO analysis of Russian issuers 4

5 Analysis by stock ex New York London Moscow Companies listed on the US exs were ahead of other markets by both liquidity and post-ipo stock price compared to in the MSCI EM index, while London and Moscow have been the most popular markets for Russian issuers. Average liquidity of London listed issuers was negatively affected by the economic crisis. The US listed issuers saw improved liquidity while the liquidity in Moscow, on average, stayed relatively flat. Average in stock price compared to in the MSCI EM index for the same period 210% 180% 150% 120% 90% 60% 30% 0% (30%) (60%) * ** (0.3) (0.6) Average liquidity for Russian issuers on a stock ex (90%) NASDAQ NYSE LSE (Premium) LSE (GDRs) LSE (AIM) MOEX (0.9) *Includes companies which moved up from LSE (GDRs) to LSE (Premium). ** Includes issuers with dual listing on other stock exs. Average in stock price compared to in the MSCI EM index for the same period Average liquidity for Russian issuers in each listing centre Number of issuers Average liquidity in this market (last 12 months ended 30 June 2015) Average liquidity in this market (last 12 months ended 31 December 2013) PwC Post-IPO analysis of Russian issuers 5

6 Top 12 Russian IPOs by in stock price compared to in the MSCI EM index (50%) 0% 50% 150% 250% % 550% 650% Magnit EPAM Systems NOVATEK Luxoft Tatneft ALROSA QIWI M.video Moscow Ex Polymetal International United Wagon Company PhosAgro Change in the MSCI EM index as of 30 June 2015 price compared to in the MSCI EM index as of 30 June 2015 Change in the MSCI EM index as of 31 December 2013 price compared to in the MSCI EM index as of 31 December 2013 PwC Post-IPO analysis of Russian issuers 6

7 Bottom 12 Russian IPOs by in stock price compared to in the MSCI EM index (180%) (130%) (80%) (30%) 20% 70% 120% Petropavlovsk RBC Mechel VimpelCom Irkut Raven Russia Belon Sistema Kuzbassenergo Razgulay Group CTC Media Mobile TeleSystems Change in the MSCI EM index as of 30 June 2015 price compared to in the MSCI EM index as of 30 June 2015 Change in the MSCI EM index as of 31 December 2013 price compared to in the MSCI EM index as of 31 December 2013 PwC Post-IPO analysis of Russian issuers 7

8 Top 20 Russian issuers by market capitalisation s were mainly interested in Russian issuers with a large market capitalisation, regardless of the ex or post-ipo stock price italization (USD mn) Analytical Issuer's market capitalisation as of 30 June 2015 Issuer's market capitalisation as of 31 December 2013 Number of analysts 0 Gazprom Rosneft LUKOIL NOVATEK Sberbank Magnit VTB Bank Tatneft Mobile TeleSystems PwC Post-IPO analysis of Russian issuers 8 Severstal VimpelCom MegaFon Polyus Gold ALROSA NLMK RUSAL Uralkali PhosAgro Yandex Mail.ru Group 0

9 Appendix Sector analysis Company name Average in stock price compared to in the MSCI EM index since IPO Average sector liquidity Number of listed companies in sector Average analyst Average company market capitalisation as of 30 June 2015 Average company market capitalisation as of 31 December 2013 Retail 69% ,049 8,445 (28%) Technology & Communications 30% ,293 9,300 (43%) Oil & Gas* 18% ,802 27,206 (31%) Financial services (35%) ,964 13,068 (47%) Transportation & Logistics (40%) ,743 (56%) Food & Beverage** (61%) (19%) Metals & Mining (63%) ,506 3,504 0% Utilities (85%) ,142 2,322 (51%) Real Estate (89%) (28%) Average (28%) ,840 7,441 (35%) * Including Oil & Gas services sector ** Including Agricultural sector Retail Company name Ex Listing date price compared to in the MSCI EM index since IPO price since IPO Market capitalisation as of 30 June 2015 Market capitalisation as of 31 December 2013 Magnit LSE (GDRs) % 555% ,316 31,300 (16%) M.video MOEX % 10% ,629 (62%) DIXY Group MOEX (8%) (12%) ,539 (52%) Lenta LSE (GDRs) (25%) (26%) ,468 n/a n/a O KEY GROUP LSE (GDRs) (64%) (79%) ,202 (80%) X5 Retail Group LSE (GDRs) (98%) (22%) ,522 4,554 (1%) Average 69% 71% ,049 8,445 (28%) Median (16%) (17%) ,103 3,202 (34%) / Increase/decrease in average liquidity for 12 months ended 30 June 2015 compared with 12 months ended 31 December 2013 PwC Post-IPO analysis of Russian issuers 9

10 Oil & Gas Company name Ex Listing date price compared to in the MSCI EM index since IPO Change in stock price since IPO italisation as of 30 June 2015 italisation as of 31 December 2013 NOVATEK LSE (GDRs) % 508% ,910 41,567 (26%) Tatneft LSE (GDRs) % 275% ,612 13,881 (16%) Eurasia Drilling Company LSE (GDRs) (3%) (30%) ,419 6,605 (63%) Exillon Energy LSE (Premium) (29%) (30%) (41%) LUKOIL LSE (GDRs) (32%) 45% ,429 53,118 (30%) C.A.T. oil Deutsche Borse (48%) (36%) ,362 (62%) Rosneft LSE (GDRs) (77%) (45%) ,664 80,705 (46%) Volga Gas LSE (AIM) (78%) (79%) (40%) RusPetro LSE (Premium) (91%) (92%) % Gazprom LSE (GDRs) (101%) (24%) , ,204 (40%) Average 18% 49% ,802 29,919 (37%) Median (40%) (30%) ,016 10,243 (32%) Technology & Communications Company name Ex Listing date price compared to in the MSCI EM index since IPO Change in stock price since IPO italisation as of 30 June 2015 italisation as of 31 December 2013 EPAM Systems NYSE % 494% ,484 1, % Luxoft NYSE % 233% ,860 1,244 49% Mail.ru Group LSE (GDRs) (8%) (25%) ,589 9,326 (51%) Yandex NASDAQ (23%) (39%) ,920 14,061 (65%) MegaFon LSE (GDRs) (27%) (31%) ,618 20,770 (59%) Mobile TeleSystems NYSE (107%) (29%) ,105 22,348 (55%) VimpelCom NYSE (153%) (76%) ,731 22,732 (62%) RBC MOEX (167%) (90%) (41%) Average 30% 55% ,293 11,521 (54%) Median (25%) (30%) ,754 11,693 (59%) PwC Post-IPO analysis of Russian issuers 10

11 Financial Services Company name Ex Listing date price compared to in the MSCI EM index since IPO Transportation & Logistics Food & Beverage price since IPO italisation as of 30 June 2015 italisation as of 31 December 2013 QIWI NASDAQ % 65% ,646 2,917 (44%) MOEX MOEX % 27% ,879 4,668 (38%) Bank Vozrozhdenie MOEX (30%) (33%) (35%) Bank Saint Petersburg MOEX (41%) (70%) (43%) Sberbank LSE (GDRs) (52%) (57%) ,171 67,891 (59%) VTB Bank LSE (GDRs) (70%) (74%) ,691 19,408 (9%) TCS Group LSE (GDRs) (76%) (84%) ,845 (81%) Sistema LSE (GDRs) (123%) (48%) ,270 15,498 (72%) Average (35%) (34%) ,964 14,263 (51%) Median (47%) (53%) ,262 3,793 (40%) Company name Ex Listing date price compared to in the MSCI EM index since IPO price since IPO italisation as of 30 June 2015 italisation as of 31 December 2013 United Wagon Company MOEX % 4% ,385 n/a n/a TransContainer LSE (GDRs) (27%) (44%) ,251 (50%) Globaltrans LSE (GDRs) (46%) (64%) ,842 (70%) Global Ports LSE (GDRs) (54%) (67%) ,671 (65%) Novorossiysk Commercial Sea Port LSE (GDRs) (60%) (87%) ,605 (60%) FESCO MOEX (66%) (78%) (53%) Average (40%) (56%) ,743 (56%) Median (50%) (66%) ,605 (54%) Company name Ex Listing date price compared to in the MSCI EM index since IPO price since IPO italisation as of 30 June 2015 italisation as of 31 December 2013 Rusagro LSE (GDRs) (23%) (44%) % Synergy MOEX (47%) (71%) (61%) Cherkizovo Group LSE (GDRs) (52%) (42%) (29%) Russian Aquaculture MOEX (61%) (70%) (7%) Black Earth Farming NASDAQ OMX (74%) (93%) (59%) Razgulay Group MOEX (111%) (89%) (7%) Average (61%) (68%) (19%) Median (57%) (71%) (60%) PwC Post-IPO analysis of Russian issuers 11

12 Metals & Mining Company name Ex Listing date price compared to in the MSCI EM index since IPO price since IPO italisation as of 30 June 2015 italisation as of 31 December 2013 ALROSA MOEX % 80% ,396 7,813 7% Polymetal International LSE (Premium)* % 28% ,449 3,710 (7%) Severstal LSE (GDRs) (30%) (15%) ,863 8,277 7% NLMK LSE (GDRs) (49%) (8%) ,971 10,123 (21%) Kuzbasskaya Toplivnaya Company MOEX (50%) (56%) (9%) Raspadskaya MOEX (55%) (40%) (29%) EVRAZ LSE (Premium)** (59%) (62%) ,728 2,730 0% RUSAL HKEX (63%) (64%) ,565 4,507 68% IRC (Petropavlovsk) HKEX (63%) (76%) (40%) Chelyabinsk Zinc Plant LSE (GDRs) (63%) (48%) % MMK LSE (GDRs) (71%) (73%) ,897 2,576 12% Polyus Gold LSE (Premium)* (94%) (86%) ,404 9,983 (16%) Belon MOEX (125%) (100%) (14%) Petropavlovsk LSE (Standard)*** (176%) (99%) % Mechel NYSE (187%) (83%) ,066 (52%) Average (65%) (47%) ,506 3,504 0% Median (63%) (62%) ,728 2,576 6% * The company moved up to the Premium segment of the LSE subsequent to the IPO (GDRs) on the Standard segment. The listing date is the date of the initial offering. ** IPO (GDRs) in For the purpose of this analysis performance is tracked from the move up to the Premium segment of the LSE in *** The company moved up to the Standard segment of the LSE subsequent to the IPO on AIM. The listing date is the date of the initial offering. PwC Post-IPO analysis of Russian issuers 12

13 Utilities Company name Ex Listing date price compared to in the MSCI EM index since IPO price since IPO italisation as of 30 June 2015 (USD mln) italisation as of 31 December 2013 TGC-7 MOEX (61%) (74%) ,710 (65%) OGK-2 MOEX (73%) (93%) (34%) Federal Grid Company LSE (GDRs) (77%) (93%) ,275 3,421 (63%) Enel Russia MOEX (84%) (69%) ,201 (54%) RusHydro LSE (GDRs) (95%) (70%) ,832 6,667 (43%) Kuzbassenergo MOEX (118%) (96%) (51%) Average (85%) (83%) ,142 2,322 (51%) Median (80%) (84%) ,456 (60%) Real Estate Company name Ex Listing date price compared to in the MSCI EM index since IPO price since IPO Market capitalisation as of 30 June 2015 italisation as of 31 December 2013 Etalon Group LSE (GDRs) (55%) (74%) ,548 (65%) LSR Group LSE (GDRs) (60%) (86%) ,041 2,156 (52%) PIK Group LSE (GDRs) (83%) (87%) ,104 1,532 37% AFI Development LSE (Premium)* (97%) (98%) (68%) MirLand Development LSE (AIM) (97%) (89%) (78%) HALS-Development LSE (GDRs) (104%) (87%) % Raven Russia LSE (Premium)** (129%) (70%) (21%) Average (89%) (84%) ,059 (34%) Median (97%) (87%) (32%) *The company moved up to the Premium segment of the LSE subsequent to the IPO (GDRs) on the Standard segment. The listing date is the date of the initial offering. ** The company moved up to the Standard segment of the LSE subsequent to the IPO on AIM. The listing date is the date of the initial offering. PwC Post-IPO analysis of Russian issuers 13

14 Other sectors Company name Sector Ex Listing date price compared to in the MSCI EM index since IPO Change in stock price since IPO italisation as of 30 June 2015 italisation as of 31 December 2013 PhosAgro Chemicals & Fertilisers LSE (GDRs) % (9%) ,973 3,802 31% Uralkali Chemicals & Fertilisers LSE (GDRs) (1%) (27%) ,620 (52%) Mostotrest Engineering & Construction MOEX (39%) (53%) ,142 (60%) MD Medical Group Healthcare LSE (GDRs) (49%) (52%) (49%) Acron Chemicals & Fertilisers LSE (GDRs) (53%) (58%) ,542 1,281 20% Protek Group Pharmaceuticals MOEX (54%) (61%) (53%) Pharmstandard Pharmaceuticals LSE (GDRs) (68%) (70%) ,499 (55%) SOLLERS Industrial Manufacturing MOEX (73%) 6% (69%) Rosinter Restaurants Restaurants MOEX (84%) (90%) (49%) TMK Industrial Manufacturing LSE (GDRs) (99%) (80%) ,066 2,764 (61%) CTC Media Entertainment & Media NASDAQ (111%) (84%) ,164 (84%) Irkut Industrial Manufacturing MOEX (136%) (59%) (30%) Average (63%) (53%) ,487 2,588 (43%) Median (61%) (58%) (63%) PwC Post-IPO analysis of Russian issuers 14

16 PwC Russia ( provides industry-focused assurance, tax, legal and business consulting services. Over 2,500 professionals working in PwC offices in Moscow, St Petersburg, Ekaterinburg, Kazan, Novosibirsk, Rostov-on-Don, Krasnodar, Voronezh, Vladikavkaz and Ufa share their thinking, experience and solutions to develop fresh perspectives and practical advice for our clients. The global network of PwC firms brings together more than 208,000 people in 157 countries. * PwC refers to AO PricewaterhouseCoopers Audit, or, as the context requires, other member firms of PricewaterhouseCoopers International Limited, each of which is a separate legal entity AO PricewaterhouseCoopers Audit. All rights reserved

Issuer Specific Disclosures of Conflicts of Interest

Issuer Specific Disclosures of Conflicts of Interest Please see below a list of issuers covered by VTB Capital Research, with applicable disclosures (as set out in the key below) identified for each such