Shares of main and distribution companies are the most undervalued from a fundamental point of view

As a result of trades on Friday the MICEX index-power industry added 6,3% and closed at around 1,771, while trading volumes have increased almost threefold, reaching a maximum for this year level. Share prices of the largest companies in the sector demonstrated positive dynamics on Friday: the value of securities FGC has grown on 15,2%, shares RusHydro went up by 0,4%, the paper IDC Holding - 13,1%, shares of Mosenergo -- at 5,5%, the paper Inter RAO UES - by 7,3%.

We want to highlight the extremely positive trend in stock price distribution and transmission companies: the cost of the shares of FGC increased by 15%, IDC Holding - 13%, while the average increase in stock price ten regional grid companies (IDCs) was in Friday 9,3%. Quotations rose on news that after the accident at the Sayan-Shushenskaya GES government has urged the speedy transfer of distribution and transmission companies in the new scheme of calculating tariffs on the basis of RAB. There are currently at a rate of EV /IRAB FGC shares traded at around 0,46 x, and shares of IDC - an average mark of 0,26 x, while the average value of the ratio of comparable companies in developing and developed markets close to 1x.

We believe that the shares of trunk and distribution companies are the most undervalued from a fundamental point of view throughout the electricity sector.

Recommendations on RTS Index futures for Monday
While not expected to significantly reduce, the MICEX index and major papers continue Comma delimited
Negative flow from China adds uncertainty about the long-term trend for reviving the global economy
The worst of the market today can be shares of MMC Norilsk Nickel
In the energy sector the most important news may be a revision of investment programs for energy companies Gazprom
Significant trading ideas the market will get only in the second half of the week
MICEX Index has consistently failed to go above 1100 points, but not in a hurry to fall below
On Friday, stock indexes in the United States showed a downward intraday dynamics
Britain calls on European countries to increase contributions to the IMF

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