The discharge epochwill take place on June, 26th annual meeting of shareholders of the Russian Open Society “United Power Systems“. On the threshold of important decisions for domestic stock market there are various estimations of risks of investments into the Russian power. On June, 19th rating agency Standard and Poor ` s (S &P) has specified in the raised risk of similar investments and even has softly threatened disobedient investors with possible decrease in their credit rating. At the same time heads of the Russian Open Society “United Power Systems“ assure of success of spent reforms. The private investor should make a hard choice.
the investor at the crossroads
Acting on June, 19th at the international economic forum in Montreal, the head of the Russian Open Society “United Power Systems“ Anatoly Chubays has told about successes of reform of the Russian electric power industry. He has declared: “ Instead of 20 generating companies we plan to receive 20 IPO that else half a year would be represented absolutely unreal and a bit mad " back;. Having reminded that a course of four already taken place IPO $6,3 mlrd investments have been involved at forecasts at level of $4 mlrd, Anatoly Chubays has expressed “ the confidence that to the middle of 2008 we will spend the others 16 IPO, and it means that 20 IPO in the Russian generation will involve $30 mlrd private investments into the Russian power “.
Earlier in Russian Open Society “United Power Systems“ plans attraction of $20 mlrd private investments appeared, now the lath is lifted. Probably, appetite comes to time of reforms. “ I only want to remind that the best prices, as a rule, are accessible at a stage of not complete building “ - has made a hint to potential investors Anatoly Chubays. He has urged them to be put more actively in the Russian power companies.
to one of the first practical steps on realisation of the plan of attraction of investments became accepted on June, 20th Russian Open Society committee “ UES of Russia “ On strategy and reforming the decision on end of consolidation TGK - 10 and carrying out dopemissii its actions on 32 mlrd roubles.
however on inspired by prospects of the Russian power of investors the cold shower has spilt. Agency S &P has published on June, 19th the report “ Pluses and minuses of investments of the European power companies in the Russian electric power industry “. In the document, in particular, it is noticed that “ investments into the Russian electric power industry as a whole will be the negative factor for credit status of the European companies owing to higher macroeconomic, sovereign and stranovyh risks in comparison with risks of investment in this or that West European country “. Also experts S &P believe that “ possibility of revision of terms and even the concept of a decontrol of the wholesale market of the electric power in Russia remains, especially taking into account forthcoming presidential election “.
For the sake of justice it is necessary to tell that reports S &P have no strongly pronounced negative character. There there are enough praises the Russian reforms. However unambiguous hints on threat to credit ratings of potential investors too are present. For example, such passage: “ We expect that the power companies of the countries of the European union can supervise susceptibility to risks of the Russian electric power industry, actively operating these risks. Influence of any investments on ratings will depend on their character, the sizes, a way of financing and from in what measure credit ratings of the company suppose possibility of similar capital investments “.
Actually, even taking into account soft reservations, such negative estimations transform the private investor into the hero at the crossroads. However, unlike the epic hero who has to disappear - it is necessary to go, investors can always find other platform for an investment of means. And then realisation of ambitious plans of the Russian Open Society “United Power Systems“ can meet difficulties.
a sight from within
Noted S &P risks influence not only foreign investors, but also on the internal. And on domestic even in bolshej to a measure. It is known that papers of the power companies are one of the most liquid tools of the Russian stock market, and possibilities for work in the world markets at our investors, as a rule, it is less, than at foreigners. For this reason actions of the Russian Open Society “United Power Systems“ and other companies of power for certain are present almost at all portfolios. And risks on them are reflected in rather considerable circle of the Russian private investors.
however, participants of the market on - to a miscellaneous have apprehended designated S &P risks. For example, analyst IK “ Fajnenshl the Bridge “ Alexey Serov confirms: “ We do not consider that for the European companies of the investment into the Russian power can become the reason of decrease in credit ratings as their participation in capitals of the generating companies will be insignificant. The Russian power is interesting to foreigners on prospect, taking into account rates of its liberalisation, but to overpay for it now they are not ready. Business in quality of our power actives: if investors bought a share in the company which garantirovanno would generate a monetary stream, that, probably, their estimations would be more optimistic. But they perfectly understand that buy capacities with 60 - percentage deterioration, the big investment program, and all it within the limits of the imperfect and not developed market which essentially limits monetary streams of the companies. If for the Russian strategists participation in power - first of all the cheap electric power for the basic business and only in long-term prospect monetary streams, for foreigners monetary streams and a recoupment of investments - a priority. Foreign estimations of potential of the Russian power actives at times are much more modest even than current market quotations. For this reason Enel, for example, did not begin to overpay for package OGK - 3. In this connection participation of foreigners in the Russian power will be more than modest. By our estimations, the foreign capital will be present a maximum at three - four power companies “.
Analitik Nomos - bank Alexander Mitus does not agree: “ Any participation of the company of the developed country in the company representing an emerging market, increases its risks. But those companies which take steps for a gain of positions in the Russian market of power, it is assured, are guided not by momentary ratings which, as it is known, regularly are exposed to revision, and have far-reaching strategic targets - to become stronger and in the future to participate in generation and distribution of the energy developed in Russia “.
Special fears of participants of the Russian market are caused by risk of a tightening of liberalisation of the market of the electric power, noted in reports S &P. Analyst BKS pays attention To it Irina Filatova: “ In my opinion, fears of experts S &P about revisions of terms and the concept of liberalisation of the free market of the electric power basically are defensible. It is impossible to exclude probability of such succession of events. Revision can be caused, for example, too high rates of increase of tariffs in the free market of the electric power that directly will be reflected in profitability of many branches of the Russian economy. Here, undoubtedly, political factor is important. If the new power keeps a current sight of the state at electric power industry development even in case of a sharp price hike rates of liberalisation can and not be reconsidered, and limiting rates of increase of the prices for the electric power in a free power market, say, will be entered. If the state heads for crackdown the scheme of liberalisation ORE can be really reconsidered in the worst for the power companies the party “.
the Leading analyst of Joint-Stock Company “ Alor Invest “ Evgenie Moshonkin is even more categorical: “ the Basic risk in the Russian electric power industry both for private, and for strategic investors which is really actual, is a tightening of terms of liberalisation of the market. We do not exclude that the decision on this point in question will be transferred for later term, especially considering forthcoming presidential election. In it we completely agree with experts from S &P. However hardly it is necessary to wait for cardinal change of the concept of reforming. It is possible only in case of political policy change that for today it is represented improbable “.
the Chief of analytical department IK “ Veles the Capital “ Michael Zak summarises: “ the Risks listed in report S &P, certainly, exist. However in case papers of the power companies would be nizkoriskovymi actives, they would not be so highly remunerative with what they are now. That is if all was clear, stable and is banal to expect those profitablenesses which show these actions, it would be not necessary. Listed by experts S &P risks are at the same time factors which give the chance to investors to earn on these actives “.
Investment appeal of the Russian power companies is based on two fundamental factors about which Anatoly Chubays has told. He has declared: “ According to forecasts, with 2007 for 2010 demand for the electric power will grow in Russia approximately on 5 % a year. It surpasses present capacities, and carrying out of reform of electric power industry ", accordingly, is necessary;. Further the head of the Russian Open Society “United Power Systems“ has added: “ it is favourable to Investors to carry out investments in the Russian market of the electric power at an early stage of reforms. From the point of view of cost of the enterprises the sector is estimated approximately in $540 for megawatt whereas in emerging markets cost for similar concerns makes $1300, and on developed - more than $2000 for megawatt “.
These fundamental factors while surpass influence of an internal and external negative in capacity. In big cities demand for the electric power is so great that again constructed enterprises equip own boiler-houses and mini - power stations as they do not have possibility to be connected to a network. In it are compelled to be engaged even far from power ritejlery. For example, in all constructed in 2007 in Moscow Region network megamollah XL, Leroy Merlin, “ Ashan “ own boiler-house - power station has been put at a design stage. On the other hand, there is a surplus of capacities in Siberia where they intended for and not constructed objects VPK.
to Transition to normal distribution of the electric power stir a deterioration of the equipment and slowness of an infrastructure. But these problems finally reform also should solve. To tighten it including on political grounds, it is possible. However to stop reforms in power - means to give up as a bad job economic growth, on what no made power will go.
Risks for investors in the Russian power, of course, exist. However it does not mean that the private investor cannot choose attractive power actives for an investment of means. It is marked also by participants of the market. Michael Zak is most optimistical: “ By our estimations, prospects of growth of cost of papers for today are present at a considerable part of actives of electropower branch. However, in power is much ` but `. However all these ` but `, in our opinion, are outweighed by prospect of growth of cost of papers of the power companies “.
For some experts participation of foreign investors in the capital of the Russian power companies is the factor reducing a risk level. So Evgenie Moshonkin considers: “ The fact of participation of the western companies in the capital of the Russian power companies - already positive factor for branch. Besides attraction of new experience, technologies and financial resources the western investors can promote acceleration of reform of electric power industry. It raises appeal of branch to private investors in long-term prospect “.
Participants of the market believe that unresolved problems of power branch should adjust investors on long-term investments. But those from them who is ready to wait, can receive the considerable income, Alexander Mitus believes: “ to Strategic investors who are ready to long-term investments, it is possible to recommend to have papers of the power companies in a portfolio. If it is a question of not qualified investors it is better for using services of specialised PIFS of power “.
Here two more opinions. Irina Filatova: “ Investors should understand how (first of all generating) capitalisation of this or that power company depends on rates of liberalisation of the wholesale market of the electric power and what its cost taking into account the most bad scenario of succession of events can be. On the basis of this understanding, and also depending on propensity to risk also it is necessary to make investment decisions on purchase or sale of corresponding papers “.
Alexey Serov: “ As a result of liberalisation of the market tariffs for the electric power by 2011 will grow twice. Concerning terms of liberalisation of the wholesale market of a reality are that that they can be reconsidered only towards reduction. However this variant too is represented improbable. The private investor should show care at a choice of objects for investments. Forthcoming year, against the whole series dopemissy, papers OGK and TGK will use the greatest demand. At a choice of object of investments it is necessary to pay attention to the future of the companies and to prefer what will enter into large power consortia - power holdings “.