The IPO market feels confident – Kommersant FM

There is a boom in IPOs in Russia. By the end of the year, more than five Russian companies are planning to conduct an initial public offering of shares on the Moscow Exchange, the platform itself reported. It is not specified which companies we are talking about, but it is stated that whether they will be listed or not “depends on market conditions.” Plans to enter an IPO before the end of 2023 were previously publicly announced by the Kristall distillery, Mosgorlombard and the fuel operator Eurotrans.

For the whole of 2022 in Russia decided to go for an IPO one company is the electric scooter rental company Whoosh. In 2023, five companies entered the stock exchange: medical center Genetico, fintech service CarMoney, IT solutions provider Softline, software developer Astra, and retailer Henderson.

Market conditions are now conducive to successful IPOs, noted investment strategist of the management company Ari-Capital Sergei Suverov: “Astra conducted a fairly successful IPO, Henderson was placed at the upper limit of the price range.

But the peculiarity of the moment is that not such large blocks of shares are being placed. We are talking about 5-10% of the authorized capital, and in terms of volume these are still not the largest placements. Before the SBO, much larger sums were attracted. Suffice it to mention the IPOs of Ozon, HeadHunter, and Cyan.

The decision to go public is explained by several reasons: interest rates on the market are currently quite high, and not all companies have access to credit financing. In addition, an IPO allows you to improve the company’s image and increase the loyalty of the customer base.

Shares can also be used as currency and used in mergers and acquisitions. Nowadays the situation with investing abroad is difficult, so investors are looking for investment options mainly in the domestic market.

If we talk about the chosen time for placement, then the conditions are favorable so far. Oil prices are relatively high, they affect the overall dynamics of the stock market. The ruble has also stabilized, which also increases the chances of the IPO being successful.

The negative impact is that, after all, there are no foreigners on the market, and these are large buyers of assets during an IPO. At the same time, everything depends on the assessment; if it is adequate, then companies from absolutely all industries can be accommodated.

It is important that they do not be greedy and give an adequate assessment, so that investors can also earn capital after the IPO. A number of issuers left the stock market, stopped publishing reports and actually trading, so the market is hungry for new names, especially high-quality ones.

Next week, Yuzhuralzoloto will most likely be listed at a discount to the market; the company is a favorite. Naturally, the technology sector is also interesting; it has the highest multiplier and is traditionally in high demand.”

The Ministry of Economic Development and the Moscow Exchange announced at the beginning of the year that ten new issuers will join the Russian stock market in 2023. In the summer, President Vladimir Putin urged businesses to more actively place their shares on the Russian stock market.

By the end of the year, according to RBC, Sovcombank also plans to hold an IPO, and in the spring of 2024, Delimobil. Forbes clarified that the car sharing service wants to raise up to 10 billion rubles. In September, the company placed bonds for 4.5 billion.

Vedomosti reported on another planned IPO – the developer of facial recognition systems Papillon Systems. The publication found relevant vacancies on the Internet for a subsidiary of the group of companies.

Investors, however, should be more careful when purchasing shares of new issuers, warned Andrey Khokhrin, director of strategic development at Ivolga Capital: “There are a lot of individuals on the market, this is not the most selective audience. On the other hand, their range of investment alternatives has been shortened as much as possible. Essentially, these are ruble shares and bonds.

Then we look at the Moscow Exchange index, and the companies we saw there are nothing new. In general, investors want something new, they see some retail brands, they want to buy their shares.

But all the players who are now trying to enter the market are very small companies. It seems that they often go public with an IPO to simply try to pay off their debts by raising free capital.

And in most cases, investors risk losing money on their investments. Meanwhile, the hopes of our companies to go somewhere outside Russia in search of money have disappeared. I believe Hong Kong is closed. We are in such monetary autarky. Maybe it’s not so bad. Russia had a big problem, since it was not a recipient, but a donor of capital.

A normal Russian super-entrepreneur had to earn money here and then take it abroad. Now no one needs our funds, it’s not particularly possible to withdraw them, so they are used here. Companies have begun to go public, this is also a sign that there is money inside Russia, and it doesn’t seem to be getting any less.”

At the same time, experts note that private investors in Russia are now showing less interest in IPOs than institutional ones. Tinkoff Investments analysts confirmed in the summer that after a lull in Russia, the IPO market is reviving. At the same time, according to their calculations, 80% of stock trading is now carried out by individuals.

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Elizaveta Skobtsova