• Russian stock market daily morning report (September 25, 2015, Friday)

    We assume that Friday the Russian market might correct upwards after a week-long drop. The revised GDP numbers in the US will be the key release on Friday.

    Main events

    OGK-2 might transfer the project within the frames of DPM to Inter RAO.

    OGK-2 losses that way an opportunity to get a guaranteed capital return considering the yield of the project, which cuts the appeal of the company. However, rise of debt (47.14 bn RUB) considering the current rates and possible penalties for a delay (3.78 bn RUB) will cut the business profitability significantly. At the meantime, collecting payment for the capacity for Verhnetagilskaya GRES in terms of DPM raised the cash flow of Inter RAO.

    We have received the comment of IR NKNH regarding the press-release posted Wednesday.

    As indicated by NKNH, there were no exact decision yet and the matters were a subject of discussion. Moreover, the technical description has not been elaborated yet, therefore, nothing has been announced regarding the investments schedule, or the possible economic efficiency of the project. Detailed elaboration of the project might take one to one and a half years. Meaning there still is a great chance that the dividends for at least 2015 are paid (however, the BoD did not comment on that). Risks for the minority of NKNH has definitely grown, however, we assume the market overreacted to the news showing such a drop within the past two days.

    Contributed by Veles Capital
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