Daily analyst comments

UES management is looking to sell the power holding’s stakes in Mosenergosbyt, Tyumen and Petersburg Energy Sales Companies in Q307, Interfax reported on Wednesday, January 24 quoting UES’ board member Vladimir Avetisyan. It was noted that initially, Petersburg Energy Sales Company was to be sold off in Q107, but UES replaced it with Vologodskaya Sales Company.

For the record, in Q107, Vologodskaya, Belgorodskaya, Kolskaya, Kuzbass, Nizhny Novgorod Sales Companies, Orenburgenergosbyt and Sverdlovenergosbyt are to be unbundled. UES’ Strategy and Reform Committee approved this list on Tuesday, January 23. The power holding’s BoD is to address it at a February 9 meeting. In the event that the list is endorsed, the auctions to sell UES’ stakes in these companies could be held as early as in March and they could be held during one day.

Taking into account the interest of strategic investors in previous transactions to divest sales assets, we expect to see renewed interest of market participants in the segment on the eve of the first wave of auctions. Sales companies which are the most undervalued by the market are given below.

In our opinion, insufficient attention of market participants in sales companies makes it possible to find appealing investment instruments and open speculative positions in a number of undervalued stocks.