Weekly overview of the Ukrainian stock market for March 11-14

PFTS index has continued to follow the dynamics of share platforms of Europe and the United States. Significant drop in the Ukrainian market on Thursday, affected all sectors, with the result that virtually all securities in the end proved to be “in the red.”

On Friday, the index continued to drop: -0.46% per day, and finally minus 9.25 points, or 0.84%, up to a week. Liquidity (310 transactions) and trading volumes (53.7 million UAH) were slightly lower than Thursday.

I note three leaders by volume: Zaporizhia Ferroalloy Plant (ZFER; 0% for the week), who played on Friday, part of his fall shaft Chervonoarmijs’ka West № 1 (SHCHZ; -1,76%) and continued to fall Ukrnafta (UNAF; -0.31%).

of the most liquid securities on Friday it should be noted Alchevsk Metallurgical Combine (ALMK; -1,84%), only traded on Friday Novomoskovsk Tubes (NVTR; -4,07%), day care for a serious negative Kryukovsky FAZ (KVBZ; -2,61%), as well as the continuing fall Ukrtelecom (UTEL; -2,21%) and Motor Sich (MSICH; -4,46%).

Against the backdrop of continuing to sink “sensations” last week: UkrAuto (AVTO) - -1,73% (up to 768 UAH per share) and Mostobud (MTBD) - -4,17% (up to 2300 UAH per share) .

crumbled Krukovka Carriages (KVBZ; -2,61%), Mariupol Tyazhmash (MZVM; -1,31%), and Luganskteplovoz (LTPL; -1,96%), is to provide growth of quotations Stakhanovsk FAZ ( SVGZ) - 0,41%

banking sector, despite pressure from the American share platforms, fell on a par with other sector in: Ukrsotsbank (USCB) - -0,82%, Raiffeisen Bank Aval (BAVL) - 1,36% , Rodovid Bank (RODB) - -2,57%

Avdeyevka (AVDK), Alchevsk (ALKZ) and Yasinovka (YASK) Coking plants per week lost about 1%. The exception among the coke became only the action “Bagley” (BKOK; +30,61%), who grow up in connection with the favorable forecasts of the enterprise. According to analysts, the shares are 40% of coke production-tion growth potential.

Last week Metallurgical Holding Evraz Group, which acquired “Bagley” in December last year, unveiled its plans for the development of the company. “Coke will increase by 2010 to 1.23 million tons per year, which is 78% higher than in 2007. To do this, in the third quarter of this year, is scheduled to launch in the work of another coke battery capacity of 0.5 million tonnes,” - notes IR Concorde Capital analyst Andrew Gerus. According to a survey company, to implement production plans, Evraz intends to Bagley high-quality coal from its mines in Russia, which will allow Coke to produce a competitive export-oriented products.

Total coke industry continues to be in demand, due to higher prices of coke and an increase in its production.

Shares CMI im.Ilicha (MMKI) decreased by only 0.15%, which is surprising considering this week made a statement that the increase Metinvest prices for iron ore by 68% from April 1, threatens to stop the plant. The only explanation, which to date quotes can support us, it is possible sale to a strategic investor. High prices may also be maintained artificially, to subsequently make a deal on a more interesting environment.

Analysts believe that the possible reduction of profitability of companies in the industry due to increased costs for the purchase of raw materials may be offset by higher prices for steel products, and therefore not reflected in the share prices of metallurgical enterprises.

Shares Azovstal “(AZST), in contrast to the CMI for the week increased by 0.99%. The company is not dependent on external suppliers, while in the structure of Metinvest exercising the whole production chain, from mining of iron ore and coking coal to melt steel. Analyst of investment group “ART-Capital Alexander Anikeev assesses the growth potential of equities at 30%.

According to the analyst, “prevailing in the global steel market pricing environment, will Azovstal increase sales in the current year by 25%. Furthermore, we commend the ongoing enterprise wide-ranging program of modernization, including construction of two new blast furnaces. Additional capacity will increase steel output by 26% (from 6.3 million tons in 2007 to 8 million tons by 2013).. Also, thanks to the use of pulverized coal injection technology in the future will completely eliminate the use of natural gas in blast furnaces. Given articulated plans to raise the price of imported gas from 2009 to the average European level this fact have a positive impact on the structure of production costs Azovstal.

continues to demand Alchevsk Metallurgical Combine (ALMK), but active sales on Friday, significantly lowered share prices - -1.84%.

analyst KUA “PIO GLOBAL Ukraine” Ekaterina Lepenicheva believes that accomplishing the modernization program the company will allow him until the end of this year to take second place in steel production in Ukraine. In addition, the measures implemented to convert the company will significantly reduce production costs, in particular, through the installation of a cogeneration plant.

“ambitious plans, which will involve almost doubling of steel production by early 2009, seem unrealistic in a situation where the company has full ownership of any iron ore or coke. But, in our view, this problem can be solved in the case merger of ISD with a Russian or other foreign steel holdings, with their own supplies of raw materials. It is likely that the merger transaction will be announced in the near future “, - says the analyst.

According to Catherine Lepenichevoy positive effect on share prices ALMK and Alchevsk Coke, part of a single industrial complex, could also have their financial statements for the year 2007, which has still not been published.

Poltava GOK (PGOK) added 1,44%. Ferrexpo has agreed to sell 1.3 million tons of pellets PGOK within three years. The company said that it is a new export customer, located next door to Ukraine and extend the production of steel.

In addition, the plant supported the comments of the owner Ferrexpo Konstantin Zhevago made Tuesday at a press conference in London at the foreground of the Central Asian countries in 2009, the market price of natural gas sales.

Zhevago stressed that the next gas price hike was expected and given the already implemented measures to reduce its consumption is not critical for the mining business. “Investors are laid in advance that everything will be at world prices. All sorts of subsidies artificially lower the cost of the company. Sooner or later you will buy at world prices”, - he added.

important event for companies mining and metallurgical sector has been the intention of the corporation Rio Tinto to increase contract prices. One of the world’s largest producers and exporters of iron ore plans during the annual negotiations with Asian steel producers to discuss rising prices for their products by more than 71%. According to the company, 65%-ing higher prices for iron ore in Brazil Vale is not a guide for the rest of the world’s producers of iron ore, so talks are continuing.

expectations of further price increases for raw materials, as well as rollback quotations virtually all companies and sectors, allowing investors to purchase shares of the following week at lower prices, may become the basis for a favorable market movement.

16 March 2008 | drop, europe, march, market, sector, thursday, united states

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