Vostok Nafta Investment Nine Months Report 2014 (VNV Global)

Summary

• Net result for the period was USD –128.51 million, compared with –25.44 in the same period of 2013.p.3
• Net asset value was USD 391.41 mln on September 30, 2014 (December 31, 2013: 633.97), or USD 5.23 per share (7.05).p.3
• Net asset value per share in USD decreased by 25.86% over the period January 1, 2014–September 30, 2014, while the RTS index decreased by 22.11%.p.5
• In the third quarter the net asset value per share in USD decreased by 8.75% (RTS index: –17.74%).p.5
• Avito reported second quarter 2014 revenues of RUB 1,069 mln, up 85% compared with RUB 579 mln in the second quarter 2013.p.7
• Vostok Nafta invested EUR 25 mln in senior secured debt of Delivery Hero with 9.5%–10.5% annual nominal interest.p.10

Key insights

1. The number of outstanding shares at the end of the period was 74,865,149.p.3
2. Senior secured debt of companies with network effects offers double digit interest rates and an all in IRR potential of some 20%.p.4
3. Avito had 59 million unique visitors during the last 31 days prior to the report, up from 40 million in 3Q13.p.7
4. Vostok Nafta sold approximately 60% of its initial stake in TCS in the IPO but is still the second largest shareholder with 4.8% ownership.p.8
5. Yell.ru had over 4.5 mln UMVs in September 2014, an increase of 112% year on year.p.9
6. GetTaxi expects to hit a run rate of USD 150 mln in revenues by year-end and continues to grow at some 400% annually.p.9
7. Delivery Hero has almost 100,000 restaurants connected and operates in 23 countries.p.10
8. A 10% lower/higher valuation of Avito would decrease/increase the portfolio by USD 21.7 mln or 5.5%.p.17