ANALYSIS: In February 2008 on GS market was still calmly

/IRBIS, Ruslan Dzyubaylo, March 18, 08/ - In February of 2008 on Kazakhstan stock exchange (KASE) in GS purchase and sale sector 118 deals for a total of KZT60,313.4 m. were registered (equivalent to 501.7 m. US dollar), which amounted 2.9% of the total exchange turnover of the month (in January - 2.4%). Relative to January of 2008, the turnover of the sector increased by 0.4% in tenge and dollar terms. Relative to February 2007, it increased by 30.6% in tenge and by 36.9% dollar terms. In the sector of primary market the Finance ministry conducted two auctions to offer MEKAM. On February 14, in the trade system of the stock exchange, the auction was conducted for offering of governmental middle-term treasury liabilities of Ministry of finance MEOKAM-24 of the 70th issue (KZK2KY020701, MOM024_0070; KZT1,000; February 14, 08 - February 14, 10, 30/360). Coupon rate was a subject of trade. Initially, it was planned to borrow KZT13,000.0 m. 18 primary dealers participated in the trades; they submitted 48 limit bids. Total volume of those bids (volume of demand) totaled KZT43,356.0 m. (333.5 % of the offered volume of bonds). Coupon rate at demand varied form 7.00% APR to 15.00% APR, making in average weighted expression 9.08% APR. By results of trades, the issuer made cut- off at the rate 8.50% and satisfied bids for purchasing of 18,466,000 bonds for amount of KZT18,466,000,000.00, which exceeded the planned volume of offering by 42.0%. at that, 7.7% from total volume of offered bonds was redeemed by pension market subjects, 58.3% - by STB, 21.7% - clients of STB, 11.4% - broker-dealer organizations, 0.9% - their clients. On February 21, in the trade system of the stock exchange, the specialized trades for offering of governmental long-term indexed savings treasury liabilities of Ministry of finance MUIKAM -72 (KZKBKY060027, MUX072_0002; KZT1,000; February 21, 08 - February 21, 14, 30/360) were conducted. Fixed coupon was a subject of trade. Initially, it was planned to raise KZT12,800.0 m. 13 primary dealers participated in the trades; they submitted 46 limited active bids. Total volume of these bids (volume of demand) totaled KZT29,720.0 m. (232.2 % of the offered volume of bonds). The rate of fixed coupon varied from 0.30% APR to 2.00 %APR, having totaled in weighted average terms 0.73%APR. By results of trade, the fixed coupon rate was set at the level of 0.50% APR; bids were satisfied to the sum of KZT16,405.0 m. (128.2% of planned volume of floatation). The forecasted yield to maturity of the floated bonds is estimated at 19.27% APR with the circulation term of bonds equal to 6 years. Secondary market remains to stay relatively calm. Amount and character of majority of deals do not let the specialists of IRBIS to extract any tendencies in this sector. Main interest of traders in February was given to primary market of treasury liabilities of finance Ministry. Unexpected seemed the offering of long term indexed on inflation rate MUIKAM. Yield on these securities made 19.27%. In terms of galloping inflation it may seem very unusual because Ministry has other more profitable instruments for financing (for example, MEOKAM). There were several reasons for such behavior. Firstly, the given offering may be not more than concession to market, on which during several years was observed the deficit of securities, yield on which could exceed the inflation rate. Secondly, Ministry could use the funds, received from such profitable instrument with aims of support of market or stabilization of financial system as a whole. Statistic indicators of Kazakhstan GS purchase and sale sector in January and the structure of the secondary market turnover are given in the table (in parentheses - comparable indicators of previous month). ------------------------------------------------------------------------------ Yield to maturity for a buyer,% year. Maturity ------------------------------------- Volume, m. term, last weighted tenge in Number days min max deal average market price of deals -------------- ------- ------- ------ -------------- ---------------- -------- Discount GS (KZT): notes of National bank, MEKKAM - 6.1% (24.7%) of the market ------------------------------------------------------------------------------ less than 8 3.50 3.50 3.50 3.50 (5.49) 224.8 1 8 - 14 7.00 7.00 7.00 7.00 (3.30) 89.9 2 15 - 28 3.00 3.00 3.00 3.00 (5.51) 159.8 1 64 - 91 7.00 7.80 7.20 7.31 ( -) 886.8 4 192 - 181 8.50 8.50 8.50 8.50 ( -) 96.0 1 182 - 364 8.50 8.50 8.50 8.50 (6.46) 103.9 1 -------------- ------- ------- ------ -------------- ---------------- -------- Subtotal 1561.2(8910.9) 10(9) -------------- ------- ------- ------ -------------- ---------------- -------- Coupon GS (KZT): МЕОКАМ, MEIKAM, MUIKAM - 93.9% (75.3%) of the market ------------------------------------------------------------------------------ less than 730 6.08 10.88 8.00 6.96 (6.55) 12,702.1 37 731 - 1095 6.48 6.51 6.48 6.50 (8.03) 5,151.1 6 1096 - 1460 6.10 6.49 6.10 6.49 (6.72) 885.6 2 1826 - 2190 17.67 19.56 19.08 18.86 (17.73) 5,135.3 16 more than 2191 23874.1(27110.0) 61(42) -------------- ------- ------- ------ -------------- ---------------- -------- Subtotal 25435.3(36020.8) 71(51) -------------- ------- ------- ------ -------------- ---------------- -------- TOTAL 6.08 10.88 8.00 6.96 (6.55) 12,702.1 37 ------------------------------------------------------------------------------ The stake of exchange's turnover in total volume of purchase and sale deals of Kazakhstan's GS secondary market totaled to 24.4% in February (in January - 47.4%). [2008-03-18]