Vostok Nafta Investment Annual Report 2013 (VNV Global)

Summary

• Net asset value was USD 633.97 mln on December 31, 2013, corresponding to USD 7.05 per share.p.7
• Net asset value per share in USD increased by 91.96%, or by 110.21% excluding the effect of the distribution of holdings in Black Earth Farming and RusForest, while the RTS index decreased by 5.52%.p.7
• The portfolio was split between Avito at 36.9%, Tinkoff Credit Systems at 21.6%, cash and cash equivalents at 38.8% and other at 2.7%.p.7
• Avito is up some 2,000% on the money invested, while TCS is up some 900%.p.3
• The Avito transaction equals SEK 255 per underlying share, a valuation of approximately USD 1.8 bln for the whole company, bringing Vostok Nafta's total shareholding to 13.7%.p.10
• Vostok Nafta sold a total of 13,824,381 TCS shares at USD 17.50 per share in the IPO for USD 232,249,596 after applicable fees and still owns 4.82%.p.12
• During 2013 the Company repurchased 1,509,279 SDRs.p.20

Key insights

1. 6.6% of the outstanding shares were bought back after some 3 weeks in the market.p.4
2. Avito published 4.5 million real estate ads in 2013 compared with 1.8 million in 2012, an increase of 150%.p.9
3. The Russian e-commerce market is expected to grow to approximately USD 25 bln in 2016 according to Goldman Sachs Investment Research.p.9
4. Avito revenues in 9M 2013 were RUB 1.6 bln, up 167% compared with 9M 2012.p.10
5. TCS had USD 2.3 bln in net loans and advances to customers as of December 31, 2013, up 43.6% year on year.p.12
6. TCS Cost of Risk increased from 10.5% in 2012 to 14.3% in 2013.p.12
7. The investment portfolio increased by USD 304.66 mln during 2013, driven by a change in fair value and result from disposals of 373.45.p.7