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FIXED INCOME
Corporate news
Top picks
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UKRAINE
Ukraine Fixed Income Weekly FIXED INCOME
11%
METINV-21
10% DTEK-24
9% UARAIL-21
METINV-26
OSCHAD-25 UKREX-25 METINV-23
8% UKREX-22 KRNL-22
OSCHAD-23
FXPO-19 (II) MHP-26
7%
MHP-24
FXPO-19 (I)
6%
5%
PUMB-18
4% MHP-20
3%
0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0
Ukraine-2020 Ukraine-2027
10
4
May-17 Jul-17 Sep-17 Dec-17 Feb-18 May-18
2
UKRAINE
Ukraine Fixed Income Weekly FIXED INCOME
Eurobonds
Modified Rating
Issue Ticker Coupon Maturity Amount $M Last Bid Ask YTM Spread
Duration Fitch/Moody’s/S&P
Sovereigns
Ukraine-2019 UKRAIN 7.75% 01.09.2019 661 102.9 103.0 104.0 5.5 1.2 319.7 B-/Caa3/B-
Ukraine-2019 (U.S.) UKRAIN 1.84% 16.05.2019 1,000 99.7 99.8 99.9 3.0 1.0 74.7 WD/-/-
Ukraine-2020 UKRAIN 7.75% 01.09.2020 1,365 102.8 102.9 103.6 6.5 2.1 394.0 B-/Caa4/B-
Ukraine-2020 (U.S.) UKRAIN 1.85% 29.05.2020 1,000 98.3 98.3 98.5 3.1 2.0 64.1 -/-/-
Ukraine-2021 UKRAIN 7.75% 01.09.2021 1,409 101.8 101.9 102.7 7.2 2.8 450.6 B-/Caa2/B-
Ukraine-2021 (U.S.) UKRAIN 1.47% 29.09.2021 1,000 95.2 95.2 95.5 3.0 3.3 34.1 -/-/-
Ukraine-2022 UKRAIN 7.75% 01.09.2022 1,384 100.3 100.5 101.2 7.7 3.6 488.8 B-/Caa2/B-
Ukraine-2023 UKRAIN 7.75% 01.09.2023 1,355 99.3 99.3 99.9 8.0 4.2 513.4 B-/Caa2/B-
Ukraine-2024 UKRAIN 7.75% 01.09.2024 1,339 98.0 97.8 98.5 8.3 4.8 525.3 B-/Caa2/B-
Ukraine-2025 UKRAIN 7.75% 01.09.2025 1,329 97.0 97.0 97.7 8.4 5.4 539.8 B-/Caa2/B-
Ukraine-2026 UKRAIN 7.75% 01.09.2026 1,318 96.4 96.6 97.3 8.4 5.9 545.6 B-/Caa2/B-
Ukraine-2027 UKRAIN 7.75% 01.09.2027 1,307 96.0 96.0 96.7 8.4 6.4 542.3 B-/Caa2/B-
Ukraine-2032 UKRAIN 7.38% 25.09.2032 3,000 89.9 90.0 91.0 8.6 8.1 570.0 B-/-/B-
Corporates
FERREXPO-19 (I) FXPOAF 10.38% 07.04.2019 80 103.3 103.3 104.3 6.6 0.9 438.7 B/Caa1/B
FERREXPO-19 (II) FXPOAF 10.38% 07.04.2019 93 103.3 103.3 104.3 6.6 0.9 439.3 B/Caa1/B
MHP-20 MHPC 8.25% 02.04.2020 79 107.0 107.0 109.0 4.4 1.8 187.8 B/-/B
MHP-24 MHPC 7.75% 10.05.2024 500 102.8 102.7 103.2 7.2 4.6 438.5 B/-/B
MHP-26 MHPC 6.95% 03.04.2026 550 96.7 96.6 97.1 7.5 5.9 455.3 B/-/B
DTEK-24 SCMHTN 10.75% 31.12.2024 1,344 105.4 105.0 106.6 9.6 4.4 630.2 C/-/-
KERNEL-22 KER 8.75% 31.01.2022 500 102.8 102.8 103.8 7.9 3.1 509.2 B+/-/B
METINVEST-21 SCMHTM 9.37% 31.12.2021 117 98.6 98.6 99.1 9.9 2.9 717.2 B/-/B-
METINVEST-23 SCMHTM 7.75% 23.04.2023 825 96.9 96.8 97.3 8.6 4.0 582.0 B/-/B-
METINVEST-26 SCMHTM 8.50% 23.04.2026 525 95.8 95.2 95.7 8.9 5.6 630.1 B/-/B-
UKRZALIZNYTSYA-21 SHORT 9.88% 15.09.2021 500 103.8 103.8 104.4 8.5 2.8 591.7 CCC/-/CCC+
Banks
UKREXIMBANK-22 CPTSNB 9.63% 27.04.2022 750 103.3 103.3 104.1 7.6 1.6 483.2 B-/Caa2/-
UKREXIMBANK-23 CPTSNB 9.00% 09.02.2023 125 99.3 99.3 100.3 9.8 0.3 - CC/Caa3/-
UKREXIMBANK-25 CPTSNB 9.75% 22.01.2025 600 103.7 103.8 104.9 8.5 3.0 560.1 B-/Caa2/-
OSCHADBANK-23 CPTSNS 9.38% 10.03.2023 700 103.3 103.3 104.1 7.5 1.7 469.6 B-/Caa2/-
OSCHADBANK-25 CPTSNS 9.63% 20.03.2025 500 103.3 103.3 105.3 8.4 2.6 547.9 B-/Caa2/-
PUMB-18 GREFI 11.00% 31.12.2018 51 103.1 103.1 103.2 4.9 0.5 401.7 B/WR/-
Derivatives
UKRAINE-40 UKRAIN 0.00% 31.05.2040 3,130 66.8 66.8 67.3 - - - -/-/B-
Distressed
AVANGARDCO-18 AVGR 10.00% 29.10.2018 227 23.0 23.0 23.3 - 0.1 - WD/-/-
INTERPIPE-17 ITRPI 10.25% 02.08.2017 200 26.0 26.0 28.0 - - - WD/-/NR
PRIVATBANK-18 (I) UKCRD 10.25% 23.01.2018 160 27.0 27.0 28.0 - - - WD/WR/-
PRIVATBANK-18 (II) UKCRD 10.88% 28.02.2018 175 31.0 31.0 36.0 - - - WD/WR/-
PRIVATBANK-21 UKCRD 11.00% 09.02.2021 220 11.0 11.0 13.0 - 0.8 - -/-/-
UKRLANDFARMING-18 AVNEXU 10.88% 26.03.2018 443 - - - - - - WD/-/NR
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UKRAINE
Ukraine Fixed Income Weekly FIXED INCOME
Money markets
Over the past week, the average UAH/USD exchange rate was up by 0.2%
Interbank rates w/w to UAH 26.22 closing at the level of UAH 26.31 on Friday. The average
Kieibor o/n Kieibor 1W Kieibor 1M daily FX turnover on the interbank decreased by 11.4% w/w to USD 212 mn,
while FX trading volume amounted to USD 227 mn on Friday. The average
16 outstanding amounts held on banks’ correspondent accounts increased by
1.2% w/w or by UAH 0.5 bn to UAH 47.2 bn.
Last week, the average rates on overnight interbank loans increased by 1
14
bps w/w to 14.77%; the rates on 1W interbank loans had a growth of 3 bps
w/w to 15.10%, the rates on 1M loans were down by 5 bps w/w to 16.10%,
12 while the rates on 3M loans remained unchanged at 16.15%.
The NBU provided UAH 1 mn of extended refinancing to banks during the
last week (no refinancing during the previous week), whereas banks acquired
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May-17 Aug-17 Oct-17 Jan-18 Apr-18
NBU deposit certificates worth UAH 94.2 bn (UAH 32.1 bn during the
* KIEIBOR—Kiev Interbank bid and offer rates
previous week).
Source: Thomson Reuters.
Date Maturity Avg. YTM Amnt placed, mn UAH Num. of bids accepted
25.04.2018 03.10.2018 17.20% 359 6
25.04.2018 06.03.2019 16.99% 71 5
25.04.2018 19.04.2023 15.97% 646 7
25.04.2018 27.11.2019 4.00% EUR 82 mn 3
18.04.2018 04.07.2018 17.36% 500 15
18.04.2018 03.10.2018 17.13% 500 8
Source: MoF
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UKRAINE
Ukraine Fixed Income Weekly FIXED INCOME
Eurobonds overview
During the last week, prices of all Ukraine’s sovereign Eurobonds issues were down. Prices on bonds with larger
maturities showed a greater drop, than with the shorter ones. The decrease of price on Eurobonds with maturity in
2019 was the smallest among all sovereign issues: the average price on Ukraine-2019 was down by 0.6% w/w to
103.2. The average price on such bonds like Ukraine-2020 and Ukraine-2021 dropped by 1.0% w/w and 1.3% w/w
to 103.6 and 102.7, while the average prices on Ukraine-2022 and Ukraine-2023 decreased by 1.7% w/w to 101.4
and 100.3 respectively. At this time, issues with maturity of more than five years were traded with a discount to the
face value. Particularly, Ukraine-2024 had an average price of 99.1 (-1.8% w/w), Ukraine-2025 – 98.4 (-2.3% w/w),
Ukraine-2026 – 97.7 (-2.4% w/w), Ukraine-2027 – 97.3 (-2.2% w/w) and Ukraine-2032 – 91.3 (-2.4% w/w).
Among our corporate picks, the average price of Ukrainian Railway-21 decreased by 1.0% w/w to 104.2, while the
average price of Metinvest-21 dropped by 1.9% w/w to 98.8.
Corporate news
METINVEST Metinvest announced its operational results for the first quarter of 2018
METINV-21 METINV-21 METINV-21
90 Our view:
85
Quarterly changes in the Company’s operating results were very
80 insignificant and are mainly related to the overhaul of some of
May-17 Jul-17 Sep-17 Dec-17 Feb-18 May-18
Metinvest's production facilities. At the same time, changes in
production volumes, compared with operating results for the first
Key financials, USD mn quarter of 2017, were more significant. Particularly, steel production
Income Statement 2015 2016 2017 suffered from the loss of control over the Yenakiieve Steel at the
Net sales 6,832 6,223 8,931 beginning of 2017, due to its location in the occupied territories, while
EBITDA 525 1,153 2,044 changes in market situation resulted in a growth in manufacturing of
Net income -1,003 118 617 finished and semi-finished products as well as in a drop of coal
Balance Sheet 2015 2016 2017 concentrate production.
Total assets 6,805 9,331 10,083
dmalynovskyi@empirestatecap.com
Total equity 4,024 4,028 4,308
Total debt 2,858 2,969 3,017
Net debt 2,766 2,743 2,758
Ratios 2015 2016 2017
D/EBITDA 5.4x 2.6x 1.5x
ND/EBITDA 5.3x 2.4x 1.3x
EBITDA/Int.exp. 2.5x 5.1x 8.8x
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UKRAINE
Ukraine Fixed Income Weekly FIXED INCOME
Corporate news
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UKRAINE
Ukraine Fixed Income Weekly FIXED INCOME
Corporate news
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7
UKRAINE
Ukraine Fixed Income Weekly FIXED INCOME
Corporate news
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8
UKRAINE
Ukraine Fixed Income Weekly FIXED INCOME
Supporting information
Exchange rate dynamics Credit Rates, %
Ukraine sovereign Eurobond prices Ukraine debt payment schedule for 2018, USD mn
Local bonds redemption Local debt servicing Eurobonds IMF
Ukraine-2020 Ukraine-2027 1800
1600
10
1400
1200
8 1000
800
600
6
400
200
4 0
May-17 Jul-17 Sep-17 Dec-17 Feb-18 May-18 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
-3 -1 2 5 7 10 12 15
PUMB-18
OSCHADBANK-25
OSCHADBANK-23
UKREXIMBANK-25
UKREXIMBANK-22
UKRZALIZNYTSYA-21
METINVEST-26
METINVEST-23
METINVEST-21
KERNEL-22
DTEK-24
MHP-26
MHP-24
MHP-20
FERREXPO-19
FERREXPO-19
9
UKRAINE
Ukraine Fixed Income Weekly FIXED INCOME
Empire State Capital Partners T/F: + 38 044 237 77 27, NY: +1 (917) 475-0447
Managing Partner
Alex Bart abart@empirestatecap.com
Equity Trading
Sergei Shmaliy sshmaliy@empirestatecap.com
Research
Managing Partner
Yaroslav Udovenko yudovenko@empirestatecap.com
About us
Empire State Capital Partners is a full service investment company with Western roots headquartered in Ukraine. We offer services in
capital markets advisory, mergers and acquisitions, debt and equity underwriting, corporate finance, brokerage, asset management
and structured products. Our team is comprised of experienced professionals from United States, Europe, Australia and Ukraine,
who have been involved in a wide variety of investment projects in CIS countries and overseas.
Disclaimer
Although the information in this report was collected in good faith and has been obtained from sources which Empire State Capital Partners believes to be reliable, we do
not represent or warrant its accuracy, except with respect to information concerning Empire State Capital Partners, its subsidiaries and affiliates, either expressly or
implied, and such information may be incomplete or condensed. Nor has the information and/or data been independently verified, and so is provided without further
caveat regarding its reliability, suitability for commerce or specific purpose.
This report does not constitute a prospectus and is not intended to provide the sole basis for an evaluation of the securities discussed herein. All estimates and opinions
included in this report constitute our judgment as of the date of the report and may be subject to change without notice. Empire State Capital Partners or its affiliates may,
from time to time, have a position or make a market in the securities mentioned in this report, or in derivative instruments based thereon, may solicit, perform or have
performed investment banking, or other services (including acting as advisor, manager) for any company referred to in this report and may, to the extent permitted by law,
have used the information herein contained, or the research or analysis upon which it is based, before its publication. Empire State Capital Partners will not be responsible
for the consequences of reliance upon any opinion or statement contained herein or for any omission. This report is confidential and is being submitted to select recipients
only. It may not be reproduced (in whole or in part) without the prior written permission of Empire State Capital Partners.
Any recommendations, opinions, forecasts, estimates or views herein constitute a judgment as at the date of this report. This document has been produced
independently of Empire State Capital Partners and the recommendations, forecasts, opinions, estimates, expectations, and views contained herein are entirely those of
the research analyst(s). While all reasonable care has been taken to ensure that the facts presented herein are accurate and that the respective recommendations,
forecasts, opinions, estimates, expectations, and views are fair and well considered, none of the research analyst(s), Empire State Capital Partners or any of its directors,
managers or employees has verified the contents of this document and, accordingly, no research analyst, Empire State Capital Partners or any of its respective directors,
managers or employees shall be in any way responsible for its contents.
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