Fundamental analysis of Alrosa shares or too many “against”

Stock dynamics

ALROSA shares grew by 1.6% to RUB 115.05. as of 14:45 Moscow time Tuesday. At the same time, the Moscow Exchange index added about 1.4%, so we can say that the security looked on par with the market.

On May 10, quotes reached a maximum of 118.13 rubles. which is a record high price since listing in 2011. Since then we have seen a correction. Today is the first most striking attempt to resume upward dynamics. It is worth noting that from the point of view of technical analysis, prices need to close at the end of the day above 114.9 rubles. (previous local peak from April 26), which declares the presence of forces to rewrite the record peak set 8 days ago.

Job Regulations and Requirements

ETP "Alrosa" is an electronic trading platform that allows you to conduct both the procurement procedure and the publication of data on the procedure itself and the results obtained. To become a bidder, you must undergo mandatory registration. The procedure itself consists of filling out personal data and sending it to the company’s address. Filling out the form and registration itself is absolutely free for all users.

Alrosa operates online and provides access 24 hours a day. Restrictions on the use of the service may be due to technical or routine maintenance.

ETP "Alrosa" provides each registered user with explanatory instructions regarding the rules of conduct and participation in trading. The participant must act in accordance with the instructions provided and not disrupt the operation of the system.

Auctions are conducted in real time using the Java application. Therefore, you need to install the updated version of “javaSE Runtime Environment” on your PC in advance.

The results of the procurement procedure on the Alrosa electronic trading platform are stored in a unified information system (this applies to transactions exceeding the cost of 500 thousand rubles). You can check the statute and the data of interest at any time.

Each participant who becomes a winner is automatically notified to the email address specified during registration.

Thus, it is possible and necessary to trade and get maximum profit. To do this, you should try your hand at the Alrosa electronic trading platform.

Search for purchases

To gain access to ongoing tenders, a potential participant should use simple instructions:

1. Go to the official website.

2. Select the “Purchases” section.

3. Go to the “Information on ongoing purchases” tab.

4. Choose one of three ETP: Sberbank-AST, EETP or Alrosa tender platform.

You can apply the necessary filter parameters and search for purchases by starting price, date, stage, region and customer.

Example of a filter on ETP "Alrosa"

If a participant is interested in familiarizing himself with the list of property being sold, he must select the appropriate section on the company’s website.

After which you can go to the section with advertisements or get acquainted with the list of non-core assets and inventory items.

Recent Key Corporate Events

ALROSA published on May 12 preliminary results of sales of rough and polished diamonds for April 2021.

The company, represented by Deputy General Director Evgeny Agureev, noted the consistently high demand for diamond jewelry in its main markets in April. According to Agureev, the situation on the rough diamond market is gradually shifting towards a supply shortage due to a structural reduction in the existing diamond mining capacity in the world. Also, April sales results were supported by successful auctions of high-quality large rough diamonds, as well as strong sales of polished diamonds.

ALROSA increased sales in April 2021 due to high demand for jewelry products

Commentary "Opening Research"

Alexey Pavlov, PhD, chief analyst at Otkritie Broker for the Russian market:

“Second consecutive strong quarter from AK ALROSA. Driven by further working capital declines on the back of strong inventory sales and seasonally low investment levels, the company's free cash flow (FCF) was again impressive in the first quarter. If 100% of FCF is paid to shareholders, which seems very likely given the negative net debt, the contribution of January-March alone to the semi-annual dividend per share will be about RUB 7.8.”

We maintain a current investment idea for ALROSA shares with a “hold” rating.

How to buy shares and receive dividends

You can purchase ALROSA shares in several ways:

• with the help of Russian brokers;
• banks that act as a broker;
• directly from the issuer, as well as from other shareholders.

In all cases, the tax on dividends and sales will be 13%.

Best brokers

Choosing a reliable broker is a very important point for any trader. Below is a rating of the best.

Reliable Russian brokers

A Caution About Forex and Binary Options

Forex and BO have nothing to do with the stock market, shares and dividends. Don't fall for scammers' tricks! Forex is an unregulated currency market that typically trades CFDs, but by purchasing this contract you will not become a shareholder of ALROSA. BO is an ordinary casino under the guise of the stock market, here it is worth understanding that the casino never loses, and therefore you are guaranteed to remain in the red.

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Mirny, April 15, 2021 — Large-scale social reforms are beginning in the Mirny district. This was the subject of the “Future of Diamond Cities” forum, which was held today in Mirny. The event was attended by the Head of the Republic Aisen Nikolaev, General Director of ALROSA Sergei Ivanov, and the head of the Mirny district Rishat Yuzmukhametov. The changes will start with the reform of the healthcare system, for which more than a billion rubles will be allocated in the coming years. Already this year, ALROSA will allocate 204 million rubles for these purposes.

The healthcare modernization program provides for a major overhaul of the buildings of the Mirny Central District Hospital - an adult clinic, an outpatient clinic in Almazny, the Svetlinskaya hospital, a antenatal clinic and maternity ward, a first-aid post in Tas-Yuryakh, and a paramedic station in Syuldyukar. A major overhaul of medical buildings with clinics in Aikhal and Udachny will also be carried out. A trauma center equipped to provide high-tech medical care will open at the Central District Hospital. Funds from the state budget of the republic, the district budget and the ALROSA company will be used to equip departments of the Mirny Central District Hospital and Aikhal Hospital with medical equipment, and to purchase cars for the municipal health care.

Since 2012, ALROSA, under an agreement with the government of Yakutia, has been financing the demolition of dilapidated and dilapidated housing. In total, over the past 9 years, 69 houses have been demolished, more than a thousand apartments have been resettled, and 9 apartment buildings have been built. Funding for the program amounted to 1.8 billion rubles. By 2023, it is planned to demolish another 12 houses and resettle 238 apartments; the company will allocate almost 780 million rubles for these purposes.

In the coming years, several large cultural and sports facilities will be commissioned in the Mirny district. In 2022, the construction of the Palace of Childhood additional education center in Mirny will be completed, for which ALROSA has allocated 230 million rubles. In the same year, a new sports and fitness complex will open on Verkhnyaya Muna, and a gym will open in the Nakyn rotational camp. ALROSA's costs for their construction will amount to 260 million rubles. In addition, from 2022, the company plans to provide free breakfasts to 5,800 students in grades 5-11. ALROSA will annually allocate more than 100 million rubles for these purposes.

For the integrated development of the urban environment in populated areas of the diamond region, ALROSA is launching a new project - the ALROSA Territory competition. It will involve projects aimed at improving the urban environment, creating modern and comfortable public and cultural spaces, and applying the best urban solutions. The company will allocate 50 million rubles annually for the implementation of such projects.

Starting from 2021, the company’s employees enjoy additional paid travel to their vacation destination in the amount of 45 thousand rubles on ALROSA Airlines flights. From 2022, employees of subsidiaries in the Mirny district, as well as 3.3 thousand employees of the municipal education system, district health care and kindergartens that are part of the Almazik organization, will receive a similar benefit. ALROSA will allocate about 80 million rubles annually for these purposes.

“The Mirny district is the birthplace of ALROSA, and we connect our future with it. We want the residents of the area to be proud of their home and our company. So that they live in comfortable conditions, use high-quality medical and other services, and have confidence in the future. At the same time, ALROSA’s participation in the life of the Mirny district is not limited to the payment of taxes and dividends, as well as social expenditures. We also finance road and housing construction and infrastructure projects. Thus, already in 2023, a new modern airport complex should open in Mirny, for which ALROSA is allocating almost 11 billion rubles,” said Sergei Ivanov, emphasizing that the company will continue to fully fulfill its obligations to the republic as a whole.

“It’s good that the ALROSA company is ready to conduct a dialogue, is involved in solving social issues and invests in the social sphere and projects not only in the Mirny district, but also in the entire republic,” the Head of the Republic of Sakha (Yakutia) Aisen Nikolaev assessed ALROSA’s initiatives. He noted that the past year was a time of difficult decisions, searching for a balance between ensuring the safety of people and preserving production. The head of the region said sincere thanks to the doctors of the Mirny district, who have been saving the health and lives of Mirny residents since the first days of the pandemic. Aisen Nikolaev said that it was the ALROSA company that became an example of solidarity and support. According to him, the company, not in words, but in deeds, showed its internal strength, its “specialness” for all of Yakutia, which was embedded in its mission from the day the enterprise was founded. The company allocated more than 800 million rubles to equip hospitals and purchase medicines in the republic. But the point is not only about financial support, but about the fact that in the most difficult time for business, the company took responsibility for organizing the fight against coronavirus in the diamond region. Aisen Nikolaev personally thanked Sergei Ivanov, all the managers and the entire ALROSA workforce.

Today ALROSA is involved in solving almost all important and pressing problems of the republic. The diamond company provides up to 40% of the republic's budget revenues and actively participates in the implementation of socially oriented programs throughout Yakutia. ALROSA annually allocates 10 billion rubles for the implementation of 500 social projects in the Republic of Sakha (Yakutia). The company also acts as the main source of funds for the Trust Fund for Future Generations of the Republic of Sakha (Yakutia). In 2021, 850 million rubles were allocated to the fund. This is 90% of all funds received by the fund. From 2011 to 2020, more than 7 billion rubles were transferred to the fund. The diamond company is the largest employer in Yakutia. During the period from 2012 to 2020, 32,239 Yakut residents went to work at ALROSA. Thanks to the dividend policy implemented by ALROSA, 8 uluses of the “diamond province” of Yakutia in the period from 2011 to 2021. received dividends in the amount of 18.627 billion rubles.

The “Future of Diamond Cities” forum was held at the Kimberlite Sports Palace and brought together a total of about 500 delegates - ALROSA employees, residents of Mirny, Udachny and Aikhal.

This page was last updated on April 15, 2021 at 1:06 p.m.