Kyiv-listed stocks rallied last week after Ukraine finally formed a
new governing coalition, with Western diplomats describing Parliament’s approval
of Volodymir Groysman as prime minister as a clearly positive development. The
nomination was approved by 257 MPs, comfortably above the minimum 226 needed.
Although the new Cabinet looks somewhat less reformist than the previous one, it
should be sufficient to bring Ukraine’s IMF borrowing back on track in the near
term. The appointment of the new government also helped to unlock another USD
1bn loan guarantee from the United States.
The
UX index climbed back to the 600-point level, gaining 4.2% for the week. Motor
Sich (MSICH) advanced 3.4% to UAH 2074, its best level in half a year.
CentrEnergo (CEEN) added 8.0% to close at UAH 6.00, as the announced schedule
for the company’s privatization with the actual auction to be held in December
provided a boost for the stock. Beaten-down Azovstal (AZST) and Avdyivka Coke
(AVDK) are now at immediate risk to be removed from the UX index, with a
decision on this matter expected on May 4. Outside the UX basket, Krukiv Wagon
(KVBZ) lost 15% to UAH 4.00 per share despite strongly positive news that the
company signed a contract to produce 750 freight railcars for Turkmenistan.
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