Ukrainian equities finished mixed in the final trading week of the slow summer period ahead of an expected pick-up in activity that traditionally occurs in the first full week of September. In the stock market related news, the State Property Fund (SPF) continued to sell off the state’s 25% blocking stakes in electricity companies to Ukraine’s richest industrialist, Rinat Akmetov. Last week the SPF sold 25% of generator DniproEnergo (DNEN) and distributor DniproOblEnergo (DNON) to Akmetov’s SCM group via auctions. SCM was the only bidder for DniproEnergo, and thus bought the stake at the auction starting price of UAH 728mn, or UAH 488 per share, a price that was 43% lower than the listed quotes for DNEN on the Ukrainian Exchange on the day before the auction. The privatization of DniproOblEnergo attracted two bidders, which doubled the starting price to UAH 1.01bn for the stake, or UAH 670 per share. This price was 2.8x higher than quotes for DNON on the UX. SCM had already owned 52% of the company through DTEK.
The UX index edged up 0.5% to close at 1136 points in light activity. Raiffaisen Bank Aval (BAVL) gained 2.0% to 27.80 kopecks as market players expect the bank to pay a 7.30 kopeck dividend per share from FY17 profit. CentrEnergo (CEEN) bounced back above the UAH 11 level, adding 2.4% to close at UAH 11.20. UkrNafta (UNAF) was the worst performing blue chip, losing 0.6% to UAH 125.
In London trading, MHP (MHPC) finally broke decisively above the USD 10.50 resistance level, adding 3.6% to USD 11.55 as investors continue to rejoice over the company’s solid financial results for 1H17. Ferrexpo (FXPO) advanced another 8.6%, smashing through the GBP 300 level to reach GBp 315, despite futures for iron ore pointing to correction in the raw material’s price in 2018. In Warsaw, shell egg producer Ovostar (OVO) declined by 2.1% to PLN 107 after the company reported worse than expected financial results for 1H17.
On the currency market, the hryvnia lost 0.9% against the dollar to close at 25.78 UAH/USD. The National Bank reported that it sold USD 44mn from its reserves over the week to support the currency.
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