Interfax wired that shares on large Russian developer PIK Group of Companies could be included in MSCI indexes, calculated by MSCI Barra, starting November 30. Along with PIK, Rosneft shares will be added. What's more, Rosneft's share in MSCI Emerging Markets will be 0.63% and PIK 0.34%.
We are upbeat on plans to include shares in a large Russian developer in calculation of indexes used by a number of Western investment funds which structure their portfolios in line with these positions.
In our opinion, this move sends a signal about growth prospects of Russia's rapidly growing residential construction sector as a whole and PIK in particular (as a large player in the sector, even taking into account all inherent risks), which significantly enhances the investment appeal of the developer's shares in the eyes of investors. Furthermore, we expect that the high ratings, assigned by Western rating agencies, will boost the liquidity of PIK shares on the Russian stock market.
According to our estimates, the estimated fair price of PIK is $32 per share.
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