russia through a lens - deloitte us · 2020-03-21 · content we are pleased to present “russia...

Russia through a lensDeloitte Research Centre

4Q 2015

Content

We are pleased to present “Russia through a lens”, the first journal produced by Deloitte Research Centre in Moscow.

Starting from December 2015, the journal will be published quarterly and will become a part of Research Centre monitoring.

In “Russia through a lens” we will focus on current key trends in Russian economy and present the results of the following studies:

• statistical analysis “Russia in figures”

• Research center market analysis

• top M&As

If you have any questions or suggestions regarding this research, please do not hesitate to contact us: [email protected]

Designed by the Deloitte Design Group, Moscow

1. Russia in figures

2. Research Center market analysis

3. Global wind

mailto:cisresearchteam%40deloitte.ru?subject=

“Skimming” Time 3

Russia in figures

GDP

GDP, bln RUR

Q1-Q3 (Jan-Sept) GDP, bln RUR

Source: Rosstat, Ministry of Economic Development (forecast)

19,43723,450

30,658 27,99133,059

40,06444,929 47,856

51,476

34,056

0

10,000

20,000

30,000

40,000

50,000

60,000

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

21,609.8 26,917.233,247.5

41,276.8 38,807.246,308.5

55,967.262,176.5 66,190.1 71,406.4 68,621.5 69,101.9

25% 24% 24%

-6%

19% 21%11% 6% 8%

-3.9% 0.7%

-1.5

-1.3

-1.1

-0.9

-0.7

-0.5

-0.3

-0.1

0.1

0.3

0.5

0

10,000.0

30,000.0

50,000.0

70,000.0

90,000.0

110,000.0

130,000.0

150,000.0

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015F 2016F

GDP GDP grows rate

19,43723,450

30,658 27,99133,059

40,06444,929 47,856

51,476

34,056

0

10,000

20,000

30,000

40,000

50,000

60,000

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

21,609.8 26,917.233,247.5

41,276.8 38,807.246,308.5

55,967.262,176.5 66,190.1 71,406.4 68,621.5 69,101.9

25% 24% 24%

-6%

19% 21%11% 6% 8%

-3.9% 0.7%

-1.5

-1.3

-1.1

-0.9

-0.7

-0.5

-0.3

-0.1

0.1

0.3

0.5

0

10,000.0

30,000.0

50,000.0

70,000.0

90,000.0

110,000.0

130,000.0

150,000.0

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015F 2016F

GDP GDP grows rate

Forecasts: Ministry of

Economic Development

Central Bank Standard & Poors

A. Kudrin, ex-Minister of Finance

Gaidar Institute

2015 -3.9% -3.9% – -4.4% -2.6% – -3.6% -4% -3.2%

2016 +0.7% -1% +1.9% – +0.3% -1% – +0.5% -1.6%

4

Russia in figures

Inflation

Inflation, %

Forecasts:

Source 2015 2016

International Monetary Fund 15.8% 8.6%

Gaidar Institute 10% 6.5–7.0%

Gaidar Institute (Consumer Price Index) 14% 7.7%

Inflation* in October 2015: 15.6%Inflation target** in 2017: 4%

*The inflation figure is the consumer price growth rate over the corresponding month of the previous year. **The inflation target is set for the consumer price growth rate over the corresponding month of the previous year (Central Bank).

Ministry of Economic Development (forecast)

Central Bank (forecast)

Fact

5.16

6.4

12.211.4

6.56.66.1

8.88.8

13.3

11.9

9.0

44

6

12.2

0

2

4

6

8

10

12

14

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

6

Russia in figures

Trade structure

Period Jan-Aug 2015 • Foreign trade turnover: USD 355.7 billion (-34.3 percent YoY)• Trade balance: surplus of USD 116.7 billion (-USD 31.7 billion YoY)• Imports: USD119.5 billion (-39.2 percent YoY)• Exports: USD 236.2 billion (-31.5 percent YoY)

Imports from non-CIS countries (period Jan-Aug 2015):

Imports from CIS countries (period Jan-Aug 2015):

Percentage in Imports to non-CIS

in monetary terms in physical terms categories

Textiles and footwear 6.4% -35.5% -29.2%

Metal products 5.8% -36.3% -30.9%

Chemical products 19.3% -28.8% -15.2%

• cosmetic products (-14.8%)

• plastics (-28.9%)• rubber (-25.3%)

Machinery and auto 47.2% -43.1% n/a• cars (-52.2%)• trucks (-74.3%)

Food and raw materials for their production

13.7% -37.8% -24.2%


Energy products 12.5% -2.6% 0.0%

Metal products 12.0% -52.1% -38.2%

• pipes (-53.6%)• flat rolled products

of iron or non-alloy steel (-22.6%)

Chemical products 15.3% -19.3% -6.8%

• products of inorganic chemistry (-3.3%)

• plastics (-8.4%)• rubber (-25.2%)

Machinery and auto 19.2% -54.8% n/a• cars (-62.4%)• trucks (-44.6%)


19.4% -1.8% n/a

Textiles and footwear 5.3 -36.6% -4.0%

Source: Federal Customs Service


Exports to non-CIS countries (period Jan-Aug 2015):

Exports to CIS countries (period Jan-Aug 2015):

Percentage in Exports to non-CIS


Energy products 68.4% -37.4% 5.6%

• crude oil (8.5%)• electrical energy (16.2%)• oil products (8.2%)• natural gas (3.2%)• coal (-0.9%)

Metal products 9.5% -12.6% 7.8%

• ferrous metals (6.5%)• cast iron (20.1%)• semi-finished products of

iron or non-alloy steel (7.8%)• ferroalloys (-21.3%)

Chemical products 6.4% -9.7% 5.5%

• products of inorganic chemistry (7.9%)

• fertilizers (5.3%)• plastics (17.3%)• rubber (21.3%)

Machinery and auto 5.0% 14.0% 40.5%• cars• trucks (-7.9%)


3.4% -19.7% n/a• barley (120.0%)• butter (39.4%)• milk and cream (9.4%)

Timber, pulp and paper products

2.6% -11.2% n/a

• lumber (17.2%)• plywood (15.2%)• cellulose (13.3%)• rough wood (-10.3%)


Energy products 40.1 -43.5% -6.8%• crude oil (-3.5%)• oil products (-25.8%)• natural gas (-27.2%)

Metal products 11.1 -25.8% 2.5%

• semi-finished products of iron or non-alloy steel (140.0%)

• flat rolled products of iron or non-alloy steel (-15.9%)

Chemical products 13.1 -18.7% n/a

• pharmaceuticals (19.9%)• paints and

varnishes (140.0%)• plastics (19.6%)• nitrogen fertilizers (-17.2%)• cosmetic products (-16.2%)

Machinery and auto 15.6 -32.2% n/a


8.9 -20.3% 7.1%

• pork (530.0%)• wheat (50.2%)• milk and cream (78.1%)• sunflower oil (2.0%)

Timber, pulp and paper products

4 -34.2% -7.8%

• lumber (-12.8%)• plywood (-10.9%)• newsprint (-21.9%)• cellulose (5.5%)

Russia in figures

Source: Federal Customs Service


0

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Euro U.S. dollar

47.98

70.14

51.76

71.37

0

20

40

60

80

Q3

20

14

Q3

20

15

Oct

ober

20

14

Oct

ober

20

15

36.16

63

40.8

63.16

0

20

40

60

80

Q3

20

14

Q3

20

15

Oct

ober

20

15

Oct

ober

20

14

0

10

20

30

40

50

60

70

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90

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Euro U.S. dollar

47.98

70.14

51.76

71.37

0

20

40

60

80

Q3

20

14

Q3

20

15

Oct

ober

20

14

Oct

ober

20

15

36.16

63

40.8

63.16

0

20

40

60

80

Q3

20

14

Q3

20

15

Oct

ober

20

15

Oct

ober

20

14

Currency rate

USD-RUR forecasts:

Ministry of Economic Development Gaidar Institute

2015 RUB 61 RUB 61.2

2016 RUB 63.3 RUB 62.2

RUB vs. EUR and USD, Jan 2014-Nov 2015

EUR-RUB USD-RUB

0

10

20

30

40

50

60

70

80

90

1-J

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Euro U.S. dollar

47.98

70.14

51.76

71.37

0

20

40

60

80

Q3

20

14

Q3

20

15

Oct

ober

20

14

Oct

ober

20

15

36.16

63

40.8

63.16

0

20

40

60

80

Q3

20

14

Q3

20

15

Oct

ober

20

15

Oct

ober

20

14

Source: Central Bank

46% 74%38% 55%


Russia in figures

10

Russia in figures

Central Bank Key Rate, %

Central Bank key rate

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

18.0

20.0

5.50

7.00 7.50 8.00 9.50

10.50

17.00

15.00 14.00

12.50 11.50 11.00

31-J

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27-D

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3



Nickel

Top-pricing (oil, gas, gold, aluminium)

Forecasts:

Source 2016

Goldman Sachs USD 14,500

106 109 108 108 109 112106 103

9586

6858 53

6255

67 65 6352 53 48 50 45

4.94.6

4.44.8

4.6 4.4

3.84.0 4.1

3.9

4.0

2.92.7 2.7 2.7 2.7 2.6

2.8 2.7 2.7 2.52.3 2.1

1223344556

20

40

60

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100

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01-J

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01-J

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5

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Brent Crude Oil, ICE, $/bbl Natural Gas, NYMEX, $/mmbtu

13,98014,677

15,911

18,325

19,25019,040

18,50518,800

16,26515,740

16,275

15,15015,165

14,095

12,395

13,950

12,60012,015

11,040

10,060

10,33010,045

8,400

7,000

9,000

11,000

13,000

15,000

17,000

19,000

21,000

01-J

an-1

4

01-F

eb-1

4

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4

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5

01-F

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01-M

ar-1

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5

Nickel, LME, $/t

1,246

1,3291,285 1,289

1,2511,328

1,284 1,2881,207

1,174 1,1511,183

1,2841,214

1,187 1,1821,192

1,1741,095

1,1421,114

1,1421,074

1,7061,7541,784 1,800

1,8291,891

1,988

2,097

1,950

2,0372,014

1,853 1,8641,8151,785

1,920

1,7401,691

1,620 1,6051,572

1,4811,451

900

1,100

1,300

1,500

1,700

1,900

2,100

2,300

01-J

an-1

4

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4

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4

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4

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5

01-F

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5

01-M

ar-1

5

01-A

pr-1

5

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5

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5

01-A

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5

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Gold, COMEX, $/t oz Aluminium, LME, $/t

Maximum for the period

5 years minimum

Source: Holding "Finam"

Russia in figures

12

106 109 108 108 109 112106 103

9586

6858 53

6255

67 65 6352 53 48 50 45

4.94.6

4.44.8

4.6 4.4

3.84.0 4.1

3.9

4.0

2.92.7 2.7 2.7 2.7 2.6

2.8 2.7 2.7 2.52.3 2.1

1223344556

20

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13,98014,677

15,911

18,325

19,25019,040

18,50518,800

16,26515,740

16,275

15,15015,165

14,095

12,395

13,950

12,60012,015

11,040

10,060

10,33010,045

8,400

7,000

9,000

11,000

13,000

15,000

17,000

19,000

21,000

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Nickel, LME, $/t

1,246

1,3291,285 1,289

1,2511,328

1,284 1,2881,207

1,174 1,1511,183

1,2841,214

1,187 1,1821,192

1,1741,095

1,1421,114

1,1421,074

1,7061,7541,784 1,800

1,8291,891

1,988

2,097

1,950

2,0372,014

1,853 1,8641,8151,785

1,920

1,7401,691

1,620 1,6051,572

1,4811,451

900

1,100

1,300

1,500

1,700

1,900

2,100

2,300

01-J

an-1

4

01-F

eb-1

4

01-M

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4

01-A

pr-1

4

01-M

ay-1

4

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4

01-J

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4

01-A

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4

01-S

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4

01-O

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4

01-N

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4

01-D

ec-1

4

01-J

an-1

5

01-F

eb-1

5

01-M

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5

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Russia in figures

Brent oil, natural gas

Natural gas

Forecasts:

Source 2016

U.S. Energy Information Administration USD 3.11


Minimum for the period

Source Q4 2015 2016 2017 2018U.S. Energy Information Administration

USD 54 USD 59

Central Bank of the Russian Federation

Base scenario: USD 50

Risk forecast: less than USD 40

Ministry of Economic Development

Conservative scenario: USD 40

Base and target scenario: USD 50



Standard & Poors USD 50 USD 55

Gaidar Institute USD 55 Pessimistic scenario: USD 40

Base scenario: USD 55

Optimistic scenario: USD 70



106 109 108 108 109 112106 103

9586

6858 53

6255

67 65 6352 53 48 50 45

4.94.6

4.44.8

4.6 4.4

3.84.0 4.1

3.9

4.0

2.92.7 2.7 2.7 2.7 2.6

2.8 2.7 2.7 2.52.3 2.1

1223344556

20

40

60

80

100

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01-J

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13,98014,677

15,911

18,325

19,25019,040

18,50518,800

16,26515,740

16,275

15,15015,165

14,095

12,395

13,950

12,60012,015

11,040

10,060

10,33010,045

8,400

7,000

9,000

11,000

13,000

15,000

17,000

19,000

21,000

01-J

an-1

4

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ep-1

5

01-O

ct-1

5

01-N

ov-1

5

Nickel, LME, $/t

1,246

1,3291,285 1,289

1,2511,328

1,284 1,2881,207

1,174 1,1511,183

1,2841,214

1,187 1,1821,192

1,1741,095

1,1421,114

1,1421,074

1,7061,7541,784 1,800

1,8291,891

1,988

2,097

1,950

2,0372,014

1,853 1,8641,8151,785

1,920

1,7401,691

1,620 1,6051,572

1,4811,451

900

1,100

1,300

1,500

1,700

1,900

2,100

2,300

01-J

an-1

4

01-F

eb-1

4

01-M

ar-1

4

01-A

pr-1

4

01-M

ay-1

4

01-J

un-1

4

01-J

ul-1

4

01-A

ug-1

4

01-S

ep-1

4

01-O

ct-1

4

01-N

ov-1

4

01-D

ec-1

4

01-J

an-1

5

01-F

eb-1

5

01-M

ar-1

5

01-A

pr-1

5

01-M

ay-1

5

01-J

un-1

5

01-J

ul-1

5

01-A

ug-1

5

01-S

ep-1

5

01-O

ct-1

5

01-N

ov-1

5


106 109 108 108 109 112106 103

9586

6858 53

6255

67 65 6352 53 48 50 45

4.94.6

4.44.8

4.6 4.4

3.84.0 4.1

3.9

4.0

2.92.7 2.7 2.7 2.7 2.6

2.8 2.7 2.7 2.52.3 2.1

1223344556

20

40

60

80

100

120

01-J

an-1

4

01-F

eb-1

4

01-M

ar-1

4

01-A

pr-1

4

01-M

ay-1

4

01-J

un-1

4

01-J

ul-1

4

01-A

ug-1

4

01-S

ep-1

4

01-O

ct-1

4

01-N

ov-1

4

01-D

ec-1

4

01-J

an-1

5

01-F

eb-1

5

01-M

ar-1

5

01-A

pr-1

5

01-M

ay-1

5

01-J

un-1

5

01-J

ul-1

5

01-A

ug-1

5

01-S

ep-1

5

01-O

ct-1

5

01-N

ov-1

5


13,98014,677

15,911

18,325

19,25019,040

18,50518,800

16,26515,740

16,275

15,15015,165

14,095

12,395

13,950

12,60012,015

11,040

10,060

10,33010,045

8,400

7,000

9,000

11,000

13,000

15,000

17,000

19,000

21,000

01-J

an-1

4

01-F

eb-1

4

01-M

ar-1

4

01-A

pr-1

4

01-M

ay-1

4

01-J

un-1

4

01-J

ul-1

4

01-A

ug-1

4

01-S

ep-1

4

01-O

ct-1

4

01-N

ov-1

4

01-D

ec-1

4

01-J

an-1

5

01-F

eb-1

5

01-M

ar-1

5

01-A

pr-1

5

01-M

ay-1

5

01-J

un-1

5

01-J

ul-1

5

01-A

ug-1

5

01-S

ep-1

5

01-O

ct-1

5

01-N

ov-1

5

Nickel, LME, $/t

1,246

1,3291,285 1,289

1,2511,328

1,284 1,2881,207

1,174 1,1511,183

1,2841,214

1,187 1,1821,192

1,1741,095

1,1421,114

1,1421,074

1,7061,7541,784 1,800

1,8291,891

1,988

2,097

1,950

2,0372,014

1,853 1,8641,8151,785

1,920

1,7401,691

1,620 1,6051,572

1,4811,451

900

1,100

1,300

1,500

1,700

1,900

2,100

2,300

01-J

an-1

4

01-F

eb-1

4

01-M

ar-1

4

01-A

pr-1

4

01-M

ay-1

4

01-J

un-1

4

01-J

ul-1

4

01-A

ug-1

4

01-S

ep-1

4

01-O

ct-1

4

01-N

ov-1

4

01-D

ec-1

4

01-J

an-1

5

01-F

eb-1

5

01-M

ar-1

5

01-A

pr-1

5

01-M

ay-1

5

01-J

un-1

5

01-J

ul-1

5

01-A

ug-1

5

01-S

ep-1

5

01-O

ct-1

5

01-N

ov-1

5


Gold and aluminium

Gold

Aluminum

Forecasts:

Source Q4 2015 2016

JP Morgan USD 1,050 USD 1,040

ABN Amro USD 1,000 USD 800

Source 2016 2017 2018

JP Morgan USD 1,525 USD 1,625 USD 1,700


Maximum for the period Minimum for

the period

Minimum for the period


Russia in figures

14

Russian market volumes*

60708110

6792

9836

1283914229

1667518198

0

5000

10000

15000

20000

2007 2008 2009 2010 2011 2012 2013 2014

2007 2008 2009 2010 2011 2012 2013 2014

2007 2008 2009 2010 2011 2012 2013 2014

2007 2008 2009 2010 2011 2012 2013 2014

2007 2008 2009 2010 2011 2012 2013 2014

2007 2008 2009 2010 2011 2012 2013 2014

13631952

2576 25413016

3943

48995423

1000

2000

3000

4000

5000

6000

7000

10871423 1654

20292686

33063867

4496

0

1000

2000

3000

4000

5000

16362112 2236

26903212

35593872 3818

0

1000

2000

3000

4000

5000

2021

2823

5872

3032

3885 3759 3584 3440

1500

2500

3500

4500

5500

6500

1412

1878

13411529

2158

30003225

2667

1000

1500

2000

2500

3000

3500

4000

60708110

6792

9836

1283914229

1667518198

0

5000

10000

15000

20000

2007 2008 2009 2010 2011 2012 2013 2014

2007 2008 2009 2010 2011 2012 2013 2014

2007 2008 2009 2010 2011 2012 2013 2014

2007 2008 2009 2010 2011 2012 2013 2014

2007 2008 2009 2010 2011 2012 2013 2014

2007 2008 2009 2010 2011 2012 2013 2014

13631952

2576 25413016

3943

48995423

1000

2000

3000

4000

5000

6000

7000

10871423 1654

20292686

33063867

4496

0

1000

2000

3000

4000

5000

16362112 2236

26903212

35593872 3818

0

1000

2000

3000

4000

5000

2021

2823

5872

3032

3885 3759 3584 3440

1500

2500

3500

4500

5500

6500

1412

1878

13411529

2158

30003225

2667

1000

1500

2000

2500

3000

3500

4000

60708110

6792

9836

1283914229

1667518198

0

5000

10000

15000

20000

2007 2008 2009 2010 2011 2012 2013 2014

2007 2008 2009 2010 2011 2012 2013 2014

2007 2008 2009 2010 2011 2012 2013 2014

2007 2008 2009 2010 2011 2012 2013 2014

2007 2008 2009 2010 2011 2012 2013 2014

2007 2008 2009 2010 2011 2012 2013 2014

13631952

2576 25413016

3943

48995423

1000

2000

3000

4000

5000

6000

7000

10871423 1654

20292686

33063867

4496

0

1000

2000

3000

4000

5000

16362112 2236

26903212

35593872 3818

0

1000

2000

3000

4000

5000

2021

2823

5872

3032

3885 3759 3584 3440

1500

2500

3500

4500

5500

6500

1412

1878

13411529

2158

30003225

2667

1000

1500

2000

2500

3000

3500

4000

Oil & gas

Largest drop

Largest drop

revenue, bln. RUR

Minimum

Maximum

Maximum

Maximum

Retail

Metallurgy

*based on the top companies by revenue, RUB bn (source: Expert400 rating)


60708110

6792

9836

1283914229

1667518198

0

5000

10000

15000

20000

2007 2008 2009 2010 2011 2012 2013 2014

2007 2008 2009 2010 2011 2012 2013 2014

2007 2008 2009 2010 2011 2012 2013 2014

2007 2008 2009 2010 2011 2012 2013 2014

2007 2008 2009 2010 2011 2012 2013 2014

2007 2008 2009 2010 2011 2012 2013 2014

13631952

2576 25413016

3943

48995423

1000

2000

3000

4000

5000

6000

7000

10871423 1654

20292686

33063867

4496

0

1000

2000

3000

4000

5000

16362112 2236

26903212

35593872 3818

0

1000

2000

3000

4000

5000

2021

2823

5872

3032

3885 3759 3584 3440

1500

2500

3500

4500

5500

6500

1412

1878

13411529

2158

30003225

2667

1000

1500

2000

2500

3000

3500

4000

60708110

6792

9836

1283914229

1667518198

0

5000

10000

15000

20000

2007 2008 2009 2010 2011 2012 2013 2014

2007 2008 2009 2010 2011 2012 2013 2014

2007 2008 2009 2010 2011 2012 2013 2014

2007 2008 2009 2010 2011 2012 2013 2014

2007 2008 2009 2010 2011 2012 2013 2014

2007 2008 2009 2010 2011 2012 2013 2014

13631952

2576 25413016

3943

48995423

1000

2000

3000

4000

5000

6000

7000

10871423 1654

20292686

33063867

4496

0

1000

2000

3000

4000

5000

16362112 2236

26903212

35593872 3818

0

1000

2000

3000

4000

5000

2021

2823

5872

3032

3885 3759 3584 3440

1500

2500

3500

4500

5500

6500

1412

1878

13411529

2158

30003225

2667

1000

1500

2000

2500

3000

3500

4000

60708110

6792

9836

1283914229

1667518198

0

5000

10000

15000

20000

2007 2008 2009 2010 2011 2012 2013 2014

2007 2008 2009 2010 2011 2012 2013 2014

2007 2008 2009 2010 2011 2012 2013 2014

2007 2008 2009 2010 2011 2012 2013 2014

2007 2008 2009 2010 2011 2012 2013 2014

2007 2008 2009 2010 2011 2012 2013 2014

13631952

2576 25413016

3943

48995423

1000

2000

3000

4000

5000

6000

7000

10871423 1654

20292686

33063867

4496

0

1000

2000

3000

4000

5000

16362112 2236

26903212

35593872 3818

0

1000

2000

3000

4000

5000

2021

2823

5872

3032

3885 3759 3584 3440

1500

2500

3500

4500

5500

6500

1412

1878

13411529

2158

30003225

2667

1000

1500

2000

2500

3000

3500

4000

Largest drop

revenue, bln. RUR

Largest drop

Maximum

Maximum

Maximum

Minimum

Banks and insurance companies

Transportation

Machine engineering



16

805 920

1402

2052 22092434

2723 2628

0

500

1000

1500

2000

2500

3000

2007 2008 2009 2010 2011 2012 2013 2014

601

1110 11371340

1605

25502159 2203

0

500

1000

1500

2000

2500

3000

2007 2008 2009 2010 2011 2012 2013 2014

530 646821

11361446

20002275

1998

0

500

1000

1500

2000

2500

2007 2008 2009 2010 2011 2012 2013 2014

550 545758 858

1231

1935 2042

1689

0

500

1000

1500

2000

2500

2007 2008 2009 2010 2011 2012 2013 2014

576773

951 10601278

14901613 1621

0

500

1000

1500

2000

2007 2008 2009 2010 2011 2012 2013 2014

8941161 1095

1355

18702122 2182

1978

0

500

1000

1500

2000

2500

2007 2008 2009 2010 2011 2012 2013 2014

805 920

1402

2052 22092434

2723 2628

0

500

1000

1500

2000

2500

3000

2007 2008 2009 2010 2011 2012 2013 2014

601

1110 11371340

1605

25502159 2203

0

500

1000

1500

2000

2500

3000

2007 2008 2009 2010 2011 2012 2013 2014

530 646821

11361446

20002275

1998

0

500

1000

1500

2000

2500

2007 2008 2009 2010 2011 2012 2013 2014

550 545758 858

1231

1935 2042

1689

0

500

1000

1500

2000

2500

2007 2008 2009 2010 2011 2012 2013 2014

576773

951 10601278

14901613 1621

0

500

1000

1500

2000

2007 2008 2009 2010 2011 2012 2013 2014

8941161 1095

1355

18702122 2182

1978

0

500

1000

1500

2000

2500

2007 2008 2009 2010 2011 2012 2013 2014

805 920

1402

2052 22092434

2723 2628

0

500

1000

1500

2000

2500

3000

2007 2008 2009 2010 2011 2012 2013 2014

601

1110 11371340

1605

25502159 2203

0

500

1000

1500

2000

2500

3000

2007 2008 2009 2010 2011 2012 2013 2014

530 646821

11361446

20002275

1998

0

500

1000

1500

2000

2500

2007 2008 2009 2010 2011 2012 2013 2014

550 545758 858

1231

1935 2042

1689

0

500

1000

1500

2000

2500

2007 2008 2009 2010 2011 2012 2013 2014

576773

951 10601278

14901613 1621

0

500

1000

1500

2000

2007 2008 2009 2010 2011 2012 2013 2014

8941161 1095

1355

18702122 2182

1978

0

500

1000

1500

2000

2500

2007 2008 2009 2010 2011 2012 2013 2014

Power generation

Largest drop

Minimum

Minimum

Wholesale trading

Food processing



Maximum

Maximum

Maximum

revenue, bln. RUR


805 920

1402

2052 22092434

2723 2628

0

500

1000

1500

2000

2500

3000

2007 2008 2009 2010 2011 2012 2013 2014

601

1110 11371340

1605

25502159 2203

0

500

1000

1500

2000

2500

3000

2007 2008 2009 2010 2011 2012 2013 2014

530 646821

11361446

20002275

1998

0

500

1000

1500

2000

2500

2007 2008 2009 2010 2011 2012 2013 2014

550 545758 858

1231

1935 2042

1689

0

500

1000

1500

2000

2500

2007 2008 2009 2010 2011 2012 2013 2014

576773

951 10601278

14901613 1621

0

500

1000

1500

2000

2007 2008 2009 2010 2011 2012 2013 2014

8941161 1095

1355

18702122 2182

1978

0

500

1000

1500

2000

2500

2007 2008 2009 2010 2011 2012 2013 2014

805 920

1402

2052 22092434

2723 2628

0

500

1000

1500

2000

2500

3000

2007 2008 2009 2010 2011 2012 2013 2014

601

1110 11371340

1605

25502159 2203

0

500

1000

1500

2000

2500

3000

2007 2008 2009 2010 2011 2012 2013 2014

530 646821

11361446

20002275

1998

0

500

1000

1500

2000

2500

2007 2008 2009 2010 2011 2012 2013 2014

550 545758 858

1231

1935 2042

1689

0

500

1000

1500

2000

2500

2007 2008 2009 2010 2011 2012 2013 2014

576773

951 10601278

14901613 1621

0

500

1000

1500

2000

2007 2008 2009 2010 2011 2012 2013 2014

8941161 1095

1355

18702122 2182

1978

0

500

1000

1500

2000

2500

2007 2008 2009 2010 2011 2012 2013 2014

805 920

1402

2052 22092434

2723 2628

0

500

1000

1500

2000

2500

3000

2007 2008 2009 2010 2011 2012 2013 2014

601

1110 11371340

1605

25502159 2203

0

500

1000

1500

2000

2500

3000

2007 2008 2009 2010 2011 2012 2013 2014

530 646821

11361446

20002275

1998

0

500

1000

1500

2000

2500

2007 2008 2009 2010 2011 2012 2013 2014

550 545758 858

1231

1935 2042

1689

0

500

1000

1500

2000

2500

2007 2008 2009 2010 2011 2012 2013 2014

576773

951 10601278

14901613 1621

0

500

1000

1500

2000

2007 2008 2009 2010 2011 2012 2013 2014

8941161 1095

1355

18702122 2182

1978

0

500

1000

1500

2000

2500

2007 2008 2009 2010 2011 2012 2013 2014

Largest drop

Largest drop

Largest drop

TMT

Construction

Industrial sector

Maximum

Maximum

Maximum

revenue, bln. RUR



18

In 2014, food price inflation reached 16.7 percent

Meat

Experts forecast inflation in Russia to fluctuate within the 8-17 percent (for more detail, see the section Statistical survey of key Russian agribusiness indicators).

19.3%Fish

18%Milk and eggs 14.2%

Bread11.6%

Research Centre market analysis

The top five constraints on the development of Russia’s agribusiness market

Shortcomings of government regulation 47%

Insufficient government support and financing 36%

Insufficient capacities and production base 32%

Lack of skilled personnel 25%

Currency risks 32%

The weakness of the agricultural production base poses a greater obstacle for the development of large agribusinesses, which are considered to be a key driving force behind Russia's overall economic recovery.

(for more detail, see the section Key drivers of competitiveness for Russian agroindustry on the global market).

The top five drivers of competitiveness in the Russian agroindustry in 2015

Abatement of geopolitical risks 72%

Stable legislative and regulatory policies 67%

Removal of administrative barriers 69%

Reduced currency risk 67%Government support: financing, subsidies, and investment 64%

(for more detail, see the section Key drivers of competitiveness for Russian agroindustry on the global market).

The development strategies of companies less favourably positioned on the market may be based on demand growth outside Russia. Meanwhile, the respondents who positively evaluate the current situation in Russian agroindustry tend to emphasise product line extension in their development strategy.

The top three factors of competitiveness for agroindustrial companies on the Russian market

Optimization of energy and commodities costs 83%

Global demand growth 72%

Removal of administrative barriers 69%

Current status and trends in Russian agribusiness, 2015We are pleased to present the main trends of agribusiness in Russia based on the results of the survey of agricultural companies conducted in August 2015.

Starting from 2015, such research will be carried out annually and will become a part of a comprehensive study on Russian agribusiness.

You can find the full version of the report on our corporate website www.deloitte.ru

http://www.deloitte.ru


(for more detail, see the section Priority development strategies for agroindustrial companies on the Russian market in 2015).

Ramp up production 83%Cut costs 81%Raise external financing 75%

Eighty-nine percent of respondents have a positive attitude toward rapprochement between Russia and the other BRICS countries, observing some strategic advantages in respect to business development.

The top three development strategies for Russian agroindustrial companies in 2015

The government should provide incentives and support Russian agribusiness both on the federal and regional levels. In the opinion of the market participants, the government should financially support the development of Russia’s agroindustry through subsidies, investments, etc. However, a pre-condition for governmental support is the lowering of administrative barriers. In aggregate, this means that any governmental support for Russia’s agroindustry and its players would yield results only if there is real access to innovations.

Incentives and support Russian agribusiness

(for more detail, see the section Governmental support for the Russian agricultural industry).

The average satisfaction level of companies with the procedures for obtaining subsidies can be described as “somewhat dissatisfied”

The majority of experts in the Russian agribusiness market view the government’s efforts in supporting the export of agricultural produce as not vigorous enough

The availability of insurance coverage for agricultural operations and assets is viewed at 58 percent (on a 100 percent scale), which can be interpreted as “somewhat available”

-3%

83%

58%

The integral assessment of the government’s efficiency in supporting and developing the agroindustry is at a medium level (47 percent of the total)

Of the respondents are interested in using external financing sources

87%

Sources of financing

(for more detail, see the section External support for Russian agroindustry).

Loans from Russian banks

Internal sources

Strategic partnership

42%36%17%

The top three sources of external financing



20

• World steel production 2014: 1,637.0 million tonnes• World steel consumption 2014: 1,523 million tonnes

• China ranks first on the list of top steel producers: 822.7 million tonnes (2014)• Russia ranks fifth on the list of top steel producers: 70.6 million tonnes (2014)• According to different expert estimates, demand for metal products will fall

from 10 to 15 percent by the end of 2015. The heaviest slump is expected from the following three industries: construction, automotive, and mechanical engineering.

• The most stable consumption of metal products is expected for the steel pipe segment due to the construction of major pipelines. Trends:

• A decline in consumption and shrinkage of the Russian domestic market • Producers focusing on optimisation • Difficult for companies to refinance existing loans or receive new loans• Increase in pricing competition • Limited export:

Restrictions against Russian steelThere are "twenty-eight restrictive non-tariff regulations" against Russian steel around the world, according to the Ministry of Economic Development’s predictions for socio-economic development in 2016-2018 issued on 1 July 2015.According to the ministry, the total damage to domestic steelmakers from international restrictions amounted to USD 1.1 billion. Russian metal exports are not expected to grow until 2018 and will remain at the 2015 level of 27.5 million tonnes.The most problematic markets for Russian metal access are the United States, the European Union, and Mexico.The damage assessment figure is comparable to the net cash flow of Severstal or NLMK.

A sharp rise in exports of cheap Chinese productsIn recent years, the global metals market has felt the effects of a significant increase in the capacity of Chinese producers. Meanwhile, China's economic slowdown and falling demand for metals, particularly in the construction sector (which accounts for half of the country’s steel consumption), led to substantial overcapacity. The result was a sharp rise in exports of cheap Chinese products.


Metals

We are pleased to present you the key findings of the Russian iron and steel market statistical analysis that we performed in September 2015. The full version of the report is available on our website www.deloitte.ru

http://www.deloitte.ru


Top-5 M&A

Naspers acquires majority stake in Russian online classifieds group Avito in $1.2 billion transaction: Naspers, which initially invested in Avito back in 2013, has increased its stake in the business from 17.4% to 67.9% on a fully diluted basis, in a vote of confidence in the growth prospects of the Russian e-commerce market. Avito’s management will remain invested, as well. The deal is valued at about $1.2 billion. Kinnevik has sold its entire 31% stake for $846 million, and Accel Partner and Northzone have also fully exited the business, Tech.eu has confirmed. As noted by its early backers (see below), this is one of the largest European VC-backed company exits ever, as it values Avito at a total of about $2.7 billion while remaining private;

On 25 September 2015, United Television Holding Russia agreed to acquire a 75 percent stake in the Russian and Kazakhstani operations of CTC Media, Inc. for USD 200.54 million;

On 10 August 2015, PromSvyazCapital will acquire a 75 percent stake in Vozrozhdenie Bank, valuing the transaction at RUB 9.46 billion (EUR 137.88 million);

On 16 September 2015, Eduard Yanakov, a Russian private citizen who is interested in mining companies and poultry production, acquired Mikhailovsky Broiler CJSC, a Russian-based poultry producer, for an undisclosed consideration;

On 2 October 2015, AFK Sistema OAO acquired JSC Kronshtadt Group, a Russian-based company, through its subsidiaries, for a consideration of RUB 4.8 billion (USD 73.25 million) from Industrial Investors Group, a Russian-based private equity firm. Kronshtadt develops and manufactures commercial UAV systems, integrated simulators and visualization systems, and on-board and ground-based radio electronic navigation;

Source: Merger Market

1.

2.

3.

4.

5.

22

Global wind

Trade turnoverChina and Russia, Q1-Q3 2015

• For the first nine months of 2015, Sino-Russian trade turnover was down by 29.3 percent YoY, to USD 50 billion;

• Exports from China fell 36 percent to USD 25.2 billion; • Imports to China declined by 20.9 percent to USD 21.8 billion.

China and Russia, September 2015• In September, China's exports to Russia fell by 33.8 percent YoY, to USD 3.59 billion,

imports decreased by 18.5 percent YoY to USD 2.64 billion;• China's foreign trade turnover in September 2015 decreased by 11.4 percent YoY to

USD 350.77 billion;• Exports from China decreased by 3.7 percent YoY to USD 205.56 billion, imports fell

by 20.4 percent YoY to USD 145.52 billion.

Source: TASS, Customs of China

InvestmentsChinese investment in the Russian economyIn the first half of 2015 the volume of accumulated Chinese direct investment in the Russian economy exceeded USD 8 billion.

• According to the Chinese Ministry of Commerce, China's volume of accumulated foreign direct investment in Russia at the end of 2014 amounted to USD 8.38 trillion (+ 10.5 percent compared to 2013);

• At the end of the first half of 2015 the volume of accumulated Chinese direct investment in the Russian economy amounted to USD 8.71 trillion (+ 11.9 percent YoY over 1H 2014);

• According to the Chinese Ministry of Commerce, the amount received by Chinese foreign direct investment in Russia in 2014 was USD 794.0 million;

• During the first half of 2015, the volume of incoming Chinese foreign direct investment in Russia amounted to USD 330 million.

Russian investment in China's economy• According to the Chinese Ministry of Commerce, the volume of accumulated Russian

foreign direct investment in China by the end of 2014 amounted to USD 910.8 million (+ 4.7 percent compared to 2013);

• By the end of 2015, the volume of accumulated Russian foreign direct investment in China totalled USD 918.72 million (5.5 percent compared to the same period in 2014);

• According to the Chinese Ministry of Commerce, the volume of incoming Russian foreign direct investment in China in 2014 amounted to USD 41.0 million;

• During the first half of 2015, the volume of incoming Russian foreign direct investment in China totalled USD 7.89 million.

Source: Ministry of Economic Development

China and RussiaAs business community nowadays shows an increased interest in cooperation between Russia and China, we decided to include this topic in our quarterly journal and feature it in every issue from this year on.


Useful stickers• RBC published its first ranking of Russia's top 500

companies. According to the ranking, oil companies are the leaders of the Russian economy.Russia's 500 largest companies generated RUB 56 trillion (approximately USD 848.68 billion at the current rate) of revenues in 2014, which translates into almost 77 percent of the country's GDP for the year.

Find out more:

• In May, Russia became Beijing’s top crude oil supplier for the first time since October 2005. In September, Chinese customs data showed that Russia exported a record amount of oil to China and for the second time this year Russia has overtaken Saudi Arabia to become China’s biggest supplier.

Find out more:

Tap on QR-code to view information

http://www.rbc.ru/rbc500/

http://mobile.reuters.com/article/idUSKCN0SF15U20151021

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