expansion of the Kazakhstan market will allow AvtoVAZ and Sollers ramp up production and marketing
AvtoVAZ has previously announced that he returned to the plans of entering the car market of Kazakhstan. Concern has worked medium-term strategy of the project until 2017
For Sollers this solution is also quite logical. Both group have extensive experience in the Russian market and is widely known in the framework of the CIS Customs Union. U Kazahstanu, there is sufficient future demand for the products of car manufacturers, due to changes in the conditions of the sale of new and used cars. After becoming one of the customs union there will be more profitable to buy a new car than a car with mileage.
As AvtoVAZ and Sollers products relates to the budget and medium-sized segments, time to market for them would be simplified. Kazakhstan interested in Russian automakers in terms of increasing production capacity, which will also make it easier for them expanding into adjacent markets.
Kazakhstan’s economy has a fairly impressive growth potential, and it offers great opportunities for Russian concerns in the market of commercial vehicles. The group Sollers, resume cooperation with the Japanese concern, Isuzu, will expand the market of medium-duty trucks, including by strengthening their positions in Kazakhstan. The same applies to light commercial vehicles Ford.
Russia and Kazakhstan is constantly expand cooperation and increase penetration in the economy of each other. This ensures the most efficient use of capital, operating with maximum efficiency.
on EV / EBITDA multiple group Sollers trading significantly below the industry average, the coefficient of EV / S coincides with the median level, EV / Net income is significantly lower than the market average. Target Securities Group is 669.357 rubalja.
estimated fair value of ordinary shares in AvtoVAZ at the level of 21.387 rubalja., On the preferred target of 7.698 rubalja. In this case the securities companies are the subject of intense speculation, which reduces their attractiveness. Dodatno, sales of Russian Lada cars in the fall the fifth consecutive month in relation to that of 2011, which also inhibits the growth of stock price concern.
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