Dividend cycle – Kommersant

April turned out to be successful for almost all areas of investment in the collective investment market. The best dynamics was demonstrated by funds focused on Russian stocks, which are steadily growing in price against the backdrop of large issuers’ plans to make large-scale shareholder payouts. Managers are counting on continued growth in the stock market, which will be facilitated by the reinvestment of dividends received by investors.

incentive payments

According to InvestFunds, last month out of 187 large retail funds (with assets over 100 million rubles), 182 showed an increase in the value of the share. More than a third of all funds provided returns to shareholders above 5%, and for the top two mutual funds, the growth in the value of a share exceeded 10%. A month earlier, each second mutual investment fund’s share price increased by more than 5%, while the top 20 reached 10–15%.

However, if in March the largest increase in the value of a share was noted in funds with foreign exchange assets, then in the past month Russian equity funds showed good results. According to InvestFunds, the value of shares of such funds increased by 5-10% over the month. This happened against the backdrop of significant growth in the Russian stock market. Last month, the Moscow Exchange Index rose by 7.5% to 2,635 points and returned to the levels of early April 2022.

The main factor that influenced the growth of Russian issuers’ share prices is the expectation of large-scale dividend payments. After Sberbank announced dividends, which turned out to be a record in the history of the issuer, the market was in anticipation of potential payments from other companies. In April, high dividends were recommended by the boards of directors of LUKOIL, NOVATEK, Tatneft.

“Additional factors that influenced the positive trend in April were the weakening of the ruble and the reduction in the discount of Russian oil Urals to Brent, which is positive for oil and gas exporters,” said Maria Trofimova, an analyst at TRINFICO Management Company. According to Profinance, in April the average cost of Urals was $58.7 per barrel, which is 13% higher than in March.

Currency support

Also, a high income (3–7.7%) was brought to shareholders by funds investing in precious metals. The best dynamics was demonstrated by mutual funds investing in physical metal, and not in ETFs. The ruble value of gold increased in the reporting period by 4.5%, to 5.16 thousand rubles per year. This was largely due to the growth of the dollar, which rose by more than 4% to 80.25 rubles/$. At the same time, on the world market, the metal rose in dollar terms by 1.2%, to $1,990 per ounce. “The main growth came at the end of the month, when another large US bank, First Republic, with assets of $229 billion, was declared bankrupt. The news fueled stock market fears about the ongoing threats to the stability of the global banking sector in the global economy,” said the managing director for investments. TKB Investment Partners Igor Kozak.

Foreign exchange revaluation also became the main driver of the increase in the value of units of Eurobond funds, replacement bonds and bonds in Chinese yuan. According to InvestFunds, shares of such funds have risen in price over the past month by 2-5.6%. At the same time, ruble-denominated government bond funds, for the most part, provided income of up to 1.5%. “The domestic debt market remains under pressure due to prevailing pro-inflationary risks, which may fully materialize in the second half of 2023,” Igor Kozak points out.

Shares in priority

In the coming months, according to analysts, the rise in the Russian market may continue. Dividend stories will continue to play a key role. “Part of the dividend payments from LUKOIL and Sberbank will most likely be reinvested in the market, and it is in shares that offer a potential return higher than on deposits and bonds,” notes Maria Trofimova. According to analysts at SberCIB Investment Research, investors can reinvest about 250 billion rubles. out of 1.8 trillion rubles. expected spring-summer dividends.

Taking into account the continuing devaluation risks due to a decrease in exports and an increase in imports, as well as due to the outflow of capital, foreign exchange funds will also be interesting for investments. “For conservative investors, currency replacement funds and yuan bonds remain attractive in terms of currency diversification of assets,” notes Maria Trofimova. In the case of ruble bond funds, market participants are less optimistic. “High levels of employment in the economy, growth in real wages, the recent devaluation of the ruble, as well as a significant budget deficit and a large volume of primary OFZ offering from the Ministry of Finance will continue to put pressure on inflation and the Russian bond market,” Igor Kozak notes.

Vitaly Gaidaev