Russian VTB bank that received $8 bln during the initial offering entered the list of the largest world IPO in 2007. The list also includes Chinese CITIC Bank Corporation and Dubai Ports World from UAE. In the analysts’ opinion of Ernst & Young consulting company, “developing markets” will exactly provide the stable inflow of companies that want to hold initial public offering (IPO) in 2008.

In 2008-2010 IPO of the following companies in the metallurgy sphere and mining sector is expected: MBC Resources, OJSC Inprom, Metalloinvest Holding, Mechel (coal segment), Russian Copper Company, VSMPO-AVISMA Corporation.

The Russian market continues to look far better than most indices of the developed and developing countries. The American and European indices closed in the easy hole for a week December, 17-21, and most markets of BRIC, except Russia, fell down by 1 – 3%.

In the opinion of the leading Russian investment banks’ representatives, activity of domestic companies in terms of stocks offering was stimulated by the growth of borrowings’ cost in the last months. Evgeny Dorofeev, chief of corporate analysis department of Bank Petrocommerce, declared that interest growth to IPO during the liquidity crisis of the Russian companies is determined by the attraction increase of this method of financing. “The main here is not a profit matter, but, on the one hand, high price of borrowings, especially from the market (without secutiry), but not bank one, and on the other hand, overvalue of risks by investors, when yields are required from the fixed income instruments, which they can’t provide. As the result money swaps into the equity securities. It turns out that IPO is now; it is simply the more advantageous method of financing”.

According to the results of 2006 Russia occupied the fourth place on IPO (initial public offering of companies’ stocks on the stock exchange) and left behind Japan, but passed forward China, the USA and Great Britain. Foreign investors buy up Russian enterprises’ and corporations’ securities. The Russian companies have started allocating stocks on the stock market one by one. According to the experts, 20 Russian companies sold stocks on $17,5 – 21 bln in the previous 2006. This figure equals the Russian debt to the Paris Club, that is $25 bln and it has been the government debt till recently. Moreover, Rosneft has recently hold the “public IPO” for $4,5 bln. Its stocks have been sold not only on a stock exchange, but also in the Sberbank branches. New Russian companies’ IPO are waited on the London Stock Exchange (LSE). According to Chris Gibson-Smith, the LSE chairman, in 2007 the amount of the Russian companies’ IPO on LSE will be the same as in 2006. He adds also that eight Russian companies hold IPO on LSE and attracted about $13 bln in 2006.

The Russian companies continue to increase the initial offerings. For the 3Q2007 there were 16 IPO (including the largest Sberbank and VТB offerings) as compared to 12 in January-September, 2006. The experts consider that by the end of 2007 there will be approximately 30 companies on the market that will attract about $26 bln.

The stockholders invested $1,6 bln. in funds according to the results of raisings into the open mutual funds in 2006. In 2006 total investments into all types of open funds have increased by 4,7 times in comparison with 2005 and totaled RUR42,2 bln. Among the open mutual funds leaders are the stock funds that attracted RUR23,5 bln. ($940 mln.). In comparison with 2005 the attraction volume into stock funds is 11,5 times more. Index funds and mixed investments mutual funds were no less popular among the investors that attracted RUR3,1 bln. and RUR12,6 bln. accordingly in the last year, that is eight times more than the results of 2005. But the fashion for conservative strategy passes away. The investors invested RUR2,5 bln in mutual funds’ bonds, that is 1,7 times less than according to the results of the last year.

The proper bill draft is introduced to the deputies of the State Duma. All regulatory enactments, that allow the act to begin work quickly, are already prepared. The bill draft has high chances to receive an approval of the Russian members of the parliament. Prepared by the FFMS it already passed reconciliation with the Ministry of Finance, Ministry of Economic Development and Trade (MEDT) and the Central Bank. Probably, the act will start acting in the middle of the next year. The entry of foreign investors can increase the volume of the Russian market by 10% in the nearest two years, experts are sure. “And first companies that will appear here are related to the local market”, says Alexander Krapivko, the senior portfolio manager of Renaissance Investment Management. “They are Danon and Strabag Construction Company etc. Those, who work on the Russian market will be presented more, those, who are not, won’t enter at all! It would be convenient for the Russian institutional investors to buy these stocks, instead of doing something to buy these securities on the NYSE, for example”.

“Russian IT market grows quicker, than telecommunication service, and should interest investors”, declared Andrey Sharonov, Troika Dialog managing director. In 2002-2006 the market grew on the average by 22% annually, and in the nearest years, expects Sharonov, it will continue to grow by 20-25% per year.

JSC TransContainer, a subsidiary of JSC Russian Railways, is Russia’s national container operator. The company appeared as the branch of just formed JSC Russian Railways on October, 2003. Legal incorporation of JSC TransContainer, reorganized from JSC Russian Railways’ branch, was registered on March, 2006. From July, 1, 2006 the company began independent economic activity. 17 branches of JSC TransContainer cover the entire Russian railway network. The company income totaled more than 167,1 mln euro for July-December, 2006, and the net income exceeded 41,3 mln euro.