VTB Capital sees new IPOs of Russian metals, retail, IT in 2018

MOSCOW, Nov 10 (PRIME) -- Russian metals, retail, construction, and IT firms may hold initial public offerings (IPOs), Dmitry Bolyasnikov, executive director for equity capital markets at VTB Capital, told PRIME on Friday.

“If we look at the pipeline (of IPO deals) that is building up now, we may see industries like metallurgy, retail, construction, IT. I think that the portfolio of transactions will be more diversified from the point of view of industrial sectors than it was this year,” he said.

In 2017, deals with metals companies dominated the market, mainly due to higher prices for their products. As of today, the volume of deals on the equity market with shares of Russian companies has already exceeded the figure of 2016, and it may top U.S. $6.5 billion in 2017, he said.

“We think that the level of activity will remain high next year, at least from the point of view of the amount of deals. Speaking of the sums of deals, it will depend on the sums of transactions. This year we had many deals of $200–300 million, and for 2018 to exceed the result of 2017 there should be larger deals of $700 million to $1 billion or more, like the IPO of En+ Group,” he said, adding that Russia is still undervalued compared to its peers.

European investors are returning to the market, and interest of Middle Eastern funds to the country is also rising.

“We may note a return of demand from investors from the continental part of Europe. Besides that, interest of sovereign funds to deals with Russian assets is rising, and we should attract them to become anchor investors,” he said.

“Speaking of geography of sovereign funds, they are mainly from the Middle East, but Chinese partners also express interest in Russian deals.”

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