Daily analyst comments

Holding MRSK confirmed yesterday’s information about its future transferring under management of the Federal grid company. Nevertheless, no specific details have been disclosed.

Yesterday, the U.S. Department of Agriculture published its estimates of major crops stocks in the U.S. and globally. The forecasted corn stock-to-use ratio turned out to be higher than expected. Most of the Western fertilizer producers underperformed the benchmarks on the news. We expect the stocks of the Russian fertilizer producers to experience some pressure as well.

Since Kubanenergo posted a RUB 1.9 bn net loss for 2011, the company’s BoD recommended no dividends for the year. The main catalyst for the name is concerned with the upcoming buyout offer to Kubanenergo minorities from Tyumenenergo.

Inter RAO has increased its stake in TGK-11 to 85% and is going to make a buyout offer to the rest of the TGK-11 minorities. Considering Inter RAO’s commitment to a complete consolidation of TGK-11, we believe that the offer will be at an attractive price level.

KuibyshevAzot has announced its 1Q12 operational results. We assess the 1Q12 results as neutral for the name, however, we note the decrease in the production of nylon-6 due to scheduled maintenance.

Evraz will ask its shareholders to approve a share buyback of up to 10% at the AGM scheduled for the 18th of June. On one hand, the buyback looks reasonable given the sharp decline of the share price, but on the other hand, a fairly substantial debt load moderating cash flows and a number of important capex-intensive projects has given not much room for actions of this type. We expect to see a moderately positive reaction from the market, with the effect unlikely being long-lived.