Ukraine Strategy Weekly: Watch News Flow from Dragon Conference
Ukrainian stock indices closed mixed last week, with the broader KP-Dragon index off 0.7% and the local PFTS index up 1.2% in USD terms (-0.1% in UAH). The main drivers were MHP (+4.1%) and locally listed Raiffeisen Bank Aval (+4.5%). At the same time, Kernel finished flat w-o-w in USD terms, hit by the PLN’s 1.7% w-o-w devaluation. Ferrexpo remained volatile as ever, closing -0.6% w-o-w (Friday-to-Friday). Milkiland surged by 49%, but volumes there were tiny.
In addition to BAVL and DOEN (+4.6% w-o-w), last week’s hryvnia appreciation (+1.1% w-o-w) helped other local shares.
Turboatom added 2.5% on virtually zero volumes, Centrenergo was flat, and Ukrnafta lost 2.9% despite the strong UAH. The latter was surprising, as the company reported strong production data for January, with oil and gas condensate up 4.2% y-o-y and 3.5% m-o-m and natural gas production up 8.5% y-o-y and 3.6% m-o-m. In contrast, BAVL benefited from provisional 2018 results, which the market took as a sign of another hefty dividend payout. The bank reported 2018 net profit of $187m, +14% y-o-y. Net loans rose 29% y-o-y, with customer deposits +11% y-o-y. NIM rose further (11.0% in 2018, +0.7pp y-o-y).