ANALYSIS: In November 2006 GS market on KASE distinctly livened up under the influence of growth of bonds offering volume

/IRBIS, Ruslan Dzubaylo, Andrey Tsalyuk, December 8, 06/ - In November 2006 on Kazakhstan stock exchange (KASE) 189 deals were registered in government securities (GS) purchase and sale sector for the total of KZT93,492.5 m. (equivalent of $730.8 m.), which was 3.6% of the total exchange turnover of the month (in October - 2.2%). Relative to October 2006 the sector's turnover increased by 50.8% in tenge expression and by 50.5% in dollar terms. Relative to November of 2005 the turnover of the sector has increased 3.6 times in tenge expression and 3.8 times in dollar equivalent. In the primary market sector Ministry of finance carried out three specialized trades on re-offering of МЕOКАМ and МЕУJКАМ. On November 22 a so-called repeated opening (re-offering) of МЕOКАМ-108 of KZK2KY090019 issue (MOM108.001; KZT1,000.0, October 15, 03 - October 11, 12, semi-annual coupon 6.2% APR, act\365) was held. Offer has reached 720.8% of the declared re-offering volume. 11 deals were concluded on offering 3,167,000 bonds for a borrowing amount of KZT3,175.5 m. At the term to maturity of 2,150 days bonds were offered under 6.20-6.50% APR. The weighted average yield of re-offering totaled 6.28% APR to redemption for a buyer. By results of special trades 15.8% of bonds were purchased by pension funds at the expense of pension assets, 42.6% by Kazakhstan banks, 41.6% by clients of banks. After conducted trades volume of KZK2KY090019 issue has reached 3,384,000 bonds. On November 6 and 29 in the trading system of KASE a re-offering of МЕУJКАМ-180 of KZKAKY150035 issue (MUJ180_0003; KZT1,000, April 18, 06 - April 18, 21, semi-annual coupon 0.01% + inflation, 30/360) was held. Bid at auctions varied from 30.3% to 101.1% of the offered volume. As a result of the re-offering the finance ministry by means of 30 deals borrowed into the budget KZT11,582.5 m. or equivalent of USD90.5 m., having sold 11,449,000 bonds under forecasted 8.14 - 9.03% APR to redemption for a buyer at the term to maturity of 5,179 and 5,202 days. The weighted average forecasted yield of re-offerings totaled 8.58% APR. Total volume of exchange deals of the primary GS market on KASE in September reached KZT14,758.0 m. or equivalent of USD115.3 m. For October corresponding indicators totaled KZT7,753.2 m. and USD60.7 m. Based on offering parameters, changes in the conjuncture of this market segment were not observed. In the secondary market sector the stake of the exchange turnover in the total volume purchase and sale deals on secondary GS market in November decreased by 41.1% (in October it totaled 70.6%). Nevertheless, market turnover has grown, which IRBIS analysts connect with the increase of emission activity of the Finance ministry and the National market. At the secondary market of notes the key influence on price dynamics exerted results of auctions, at which, as it was said above, yield of bonds slightly increased. Yield of longer МЕОКАМ and МЕUКАМ practically remained at the same level. Statistical indicators of GS purchase-and sale sector in November and the structure of turnover of the secondary market are given in the table (in parentheses - comparative indicators of the previous month). ------------------------------------------------------------------------------- Yield to maturity for the buyer, %APR Term ------------------------------- Volume, m. KZT Number till maturity min max last WA at market price of deals -------------- ----- ----- ---- ----------- ------------------- --------- Discounted GS (KZT): National Bank's notes - 81.9% (80.2%) of the market ------------------------------------------------------------------------------- less 8 2.80 4.00 2.80 3.64 (2.95) 21,200.8 20 8 - 14 3.10 4.25 4.18 4.01 (4.30) 26,605.0 27 15 - 28 3.99 4.25 4.00 4.08 (3.97) 16,697.3 18 -------------- ----- ----- ---- ----------- ------------------- --------- Total 64,503.1 (43 498.9) 65 (27) -------------- ----- ----- ---- ----------- ------------------- --------- Coupon GS (KZT): MEOKAM, MEUKAM - 18.1% (19.8%) of the market ------------------------------------------------------------------------------- less than 730 5.30 14.64 5.30 5.68 (5.65) 4,054.5 21 731 - 1095 1.50 6.50 5.97 5.78 (6.02) 1,856.5 20 1096 - 1460 1.00 6.50 6.20 5.99 (5.96) 3,776.6 33 1461 - 1825 3.83 6.00 6.00 6.00 (5.68) 102.3 2 more than 2191 5.49 5.50 5.50 5.50 (5.50) 4,436.9 4 -------------- ----- ----- ---- ----------- ------------------- --------- Total 14,226.8 (10,749.8) 80 (57) -------------- ----- ----- ---- ----------- ------------------- --------- Coupon GS (USD): bonds of Atyrau oblast and Astana city - 0.006% (0.003%) of the market ------------------------------------------------------------------------------- less than 730 6.20 7.50 6.50 6.73 (5.50) 4.6 3 -------------- ----- ----- ---- ----------- ------------------- --------- Total 4.6 (1.5) 3 (1) -------------- ----- ----- ---- ----------- ------------------- --------- GRANDTOTAL 78,734.5 (54,250.3) 148 (104) ------------------------------------------------------------------------------- [2006-12-08]