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15TH ANNIVERSARY: BUSINESS-LIKE INVESTMENT - IN RUSSIA

Book cover

Download an essay to mark the 15th Anniversary of Prosperity Capital Management, written by Mattias Westman


 

PROSPERITY NEWSFLASH

  • PCM is pleased to announce that the "closed-ended" Prosperity Russia Domestic Fund, launched in 2007 and traded on AIM with a $220m AUM, will "open-end" on 17th February, with a first transaction date of 30th March.
  • The Fund offers exposure to Russia's fast-growing "domestic economy" - largely ignored by international portfolio investors, despite Russia/CIS being a region of 300m people.
  • At $13,250, per capita incomes in Russia outstrip those in other large emerging markets (EMs). Russians spend a large share of their incomes on consumption as personal taxation is low (13% basic rate) and, despite 93% home-ownership, mortgage debts are minimal (outstanding home loans are just 3% of GDP).
  • Since 2000, Russian retail turnover has risen at 20% CAGR. The country is now Europe's second's-largest retail market, with 2011 sales of $621bn according to Euromonitor. Russia is set to top the European retail league by 2013/14, with rising wages and fast-expanding consumer credit the major growth-drivers.
  • Portfolio investors often favor Russian energy stocks, which make up 53% of the RTS index of leading shares. Yet the export-focus of such companies makes their earnings much more vulnerable to swings in global investor sentiment. Oil/gas today accounts for just 17% of Russia's economy, down from 40% in 2003.
  • Russia's service sector is 59% of GDP and outstrips oil/gas in terms of both scale and profitability, but is barely included in the RTS. Across Russia/CIA, agriculture, transport and  utilities also offer major opportunities.
  • The newly "open-ended" PRDF fund, Cayman-domiciled and with quarterly liquidity, will be run by PCM. Founded in 1996, PCM is the world's leading Russia/CIS-focused asset manager, with $3.5bn AUM. The Fund will be advised by Alexei Krivoshapko, PCM's Moscow-based Director of Consumer, Retail, Agriculture & Real Estate.

Prosperity Capital Management has released a Prosperity Newsflash - accessible via this link - offering further information.

 » PROSPERITY CAPITAL MANAGEMENT LIMITED, THE MANAGER OF PRDF, WILL HOST A CONFERENCE CALL FOR SHAREHOLDERS OF PRDF ON WEDNESDAY 1 FEBRUARY 2012 AT 13:30 GMT

Tomas Olsson (Partner) and Alexey Krivoshapko (Partner and Portfolio Advisor to PRDF) will offer an update on PRDF and also outline the Manager's investment plans following the forthcoming open ending of the Company.

 This will be followed by a Q & A session.

Access details for the call are available via this link. 

A copy of the accompanying presentation can be accessed from this link.  


 

From Russia with love

PCM's Chief Economist, Liam Halligan, discusses his views on the rapidly developing economic and political situations in the eurozone - in the context of the global financial crisis - as well as highlighting the relative strengths of the emerging markets, not least Russia, to their Western peers.

 

"Halligan, who now lives and works in Moscow, cited the huge economic growth of Russia under Putin and now Medvedev: since 1999, the country has grown in real terms on average 7% a year. Halligan said that while the West digs itself into a even deeper hole, Russia and the emerging markets are where the future lies." Citywire - Wealth Manager


BLOOMBERG INTERVIEW WITH MATTIAS WESTMAN

  • Russian Prosperity Fund Noted As 2nd Best Performing Large Hedge Fund Of 2010 By Bloomberg Markets Magazine
  • Prosperity Capital Management Recognised As A "Bloomberg Best"

Mattias Westman (Founding Partner) discusses how Prosperity Capital Management seeks to access the considerable Russian investment opportunity whilst addressing the risks of investing in the region. 

» MORE » BLOOMBERG MARKETS ARTICLE: A RUSSIAN ACTIVIST


Company of the Month

Transneft logo

Transneft is Russia’s state-controlled oil and oil products transportation monopoly. The company owns and operates 70,000 km of trunk pipelines that move 466m tons of crude annually - 92% of Russia’s total production. While all ordinary shares are owned by the government, 22% of the capital is on the market as non-voting preferred shares, entitling owners to 10% of unconsolidated net profit.

» MORE» PREVIOUS COMPANIES OF THE MONTH


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PCM FUNDS LEAD THE WORLD

Pursuing a "long-only, activist" strategy in Russia/CIS, PCM's three main funds, all open-ended and unleveraged, have returned 3,604%, 1,828% and 1,605% in the last decade. The returns - all net of fees and in dollar terms - place PCM funds first, second and third of all funds in the world between December 1999 and December 2009.

» MORE

ANNUAL INVESTOR TRIP

Prosperity Capital is pleased to announce the dates of our 2012 Investor Trip. We will be delighted to welcome clients to Moscow on Wednesday 26th & Thursday 27th September.

As in previous years, the Investor Trip agenda will include presentations from senior members of the PCM team and panel discussions featuring leading company executives from Russia and across the CIS, as well as company visits and cultural/social events.

An optional trip outside of Moscow will take place on Friday 28th September, again including company visits and cultural/social events, for those who wish to spend a little more time in Russia and get to know the country better.

» PCM’s 15th Anniversary Investor Trip 2011 attracted 120 delegates to Moscow. The agenda, photos and presentations are available here.

QUARTERLY INVESTMENT CALLS

The last quarterly calls took place on:

24TH JANUARY 2012

Please download slides and recording of the last call here (transcription coming soon).

17TH OCTOBER 2011

Please download slides, recording and transcription of the last call here.