7 Apr 2021 18:44

Successful IPOs by Russian companies have woken up market, its volumes will grow - bankers

MOSCOW. April 7 (Interfax) - Recent successful IPOs by Russian issuers, including Ozon and retailer Fix Price , have stirred the market: more and more companies from Russia are thinking about public offerings, and the volume of this market will grow in the near future, according to bankers and investors who participated in the relevant session of the Exchange Forum organized by the Moscow Exchange .

"We're talking about valuing the pipeline for 2021-2022 at 10-12 billion dollars equivalent in terms of public transactions in the equity market. I think we will see both the 'old economy' and quite actively the 'new economy', more than 50% [of the total IPO volume] will be the new economy," Gazprombank first vice president Denis Shulakov, said at the session focusing on the equity capital market boom.

"It's very difficult to guess how many deals there will be specifically. But I agree that the deals of the last 12 months, they have to a certain extent woken up the market. Much like the Mail.ru IPO in 2010 and the Yandex in 2011 woke up the market, including entrepreneurs, excited private equity investors and stimulated them to invest in companies of the new economy. Approximately the same thing is happening now," Dmitry Sedov, chairman of the Goldman Sachs Bank board of directors, said.

"The IPOs of recent months have led even those companies that had no plans to enter the market, but had significant growth, to discover a little more enthusiasm, to begin to turn to banks, they begin to respond to calls from banks to think that an offering might be possible in principle. What's more important, they have begun making longer-term plans. The conversations we have with companies now are not about tomorrow, not about the day after tomorrow, but about 2021, about 2022, sometimes about 2023, i.e., longer-term planning. And indeed, "new economy" companies are a significant percentage of those projects that we have and will have," Sedov said.

"We expect continued placements, successful placements, significant in terms of volume and potential investor interest, so we are optimistic," the banker said.

Potential buyers of new IPOs were represented at the session by East Capital Investment partner Jacob Grapengiesser. He said that the emergence of new Russian companies on the public market is a big upside for investors.

"Not just oil and gas, but more interesting companies like Ozon, Fix Price, for example. I think that for investors, for funds, this is actually a huge plus. Because Russia is still, as they say, a narrow market, few companies are trading here. More companies are needed, maybe two or three times more, for it to become a really attractive market for international investors," he said.