Market reviews and recommendations of BCC Invest JSC (Kazakhstan) analysts for May 21, 2010

/IRBIS, May 21, 2010/ - BCC Invest JSC has provided IRBIS with a survey of main events, market reviews and investment ideas for May 21, 2010. Analysts of JSC "BCC Invest" indicate that yesterday the shares of ENRC PLC and Kazakhmys PLC on the London Stock Exchange fell - respectively 5.89% (9.35 pounds) and 4.31% (10.89 pounds). Also, yesterday, Depositary Receipts of Kazkommertsbank and KMG in London have fallen - by 6.65% ($5.90) and 6.24% ($19.55), respectively, Halyk Bank - slightly increased by 0.14% ($7.35). Negative closing trades in Europe and the U.S. yesterday and pessimism in Asia today, according to analysts AO "BCC Invest", will be a catalyst for further decline of the Kazakhstan market shares. Analysts expect a negative opening of trading on KASE, but during the day in anticipation of weekend market can change its direction of motion. The current correction in the market creates opportunities for open positions in the long term. Analysts JSC BCC Invest also expect the following developments in international markets: - FSA have not found violations of banking laws in the Bank "CenterCredit - Financial Police. Chapter of "TsentrKredit" waits for the checks in the bank two weeks. Mr. Vladislav Lee Chairman of the Kazakh commercial bank CenterCredit (BCC) hoped that the State Agency for Combating Economic and Corruption Crimes (Financial Police) and the State Agency for Regulation and Supervision of Financial Market and Financial Organizations (AFN) will complete the audit in the bank after two week. Mr. V. Lee noted that the bank had no transactions with lending to foreign business. Total lending-related projects abroad, less than 1%. The securities portfolio, which amounts to KZT350 billion, 90% consists of government securities (Kazakhstan - Interfax-Kazakhstan). Rumors have arisen in connection with the designated verification of possible suspicious transactions the bank, including in respect of the share capital. However, management of JSC "Bank CenterCredit confidently asserts that the bank has no business causing doubts as to its legal and financial feasibility, or even remotely resembling what was found in the BTA or the Alliance. The main shareholder of BCC is a South Korean Kookmin Bank with a share of 41.93% shares. Also, its major shareholders are Mr. Bakhytbek Baiseitov with a share of 25.11% and the International Finance Corporation (IFC) with a share of 10%. According to analysts of JSC "BCC Invest" data is positive news for the securities of JSC Bank CenterCredit, traded on the Kazakhstan Stock Exchange. Analysts remain recommendation "BUY" on ordinary shares of JSC "Bank CenterCredit, but soon plan to release the report in accordance with published data for the first quarter of this year. - Shareholders of KazakhGold re-elected Board of Directors in its previous composition. The Board of Directors re-elected in KazakhGold former structure: it included 4 representatives of Russia's CJSC Polyus Gold "(which owns 50.1% stake), an independent director and a representative of the family Assaubaev, who previously served as the main shareholder of Kazakh companies. As stated in the message KazakhGold, shareholders of the company's annual meeting May 20, 2010 approved all the decisions, the predicted meeting agenda. In particular, according to the agenda, the shareholders asked to re-elect the board of general director of Polyus Mr. Yevgeny Ivanov, Mr. Pihoyu Hermann general deputy director for strategy and corporate development, Mr. Oleg Ignatov deputy general director on economy and finance, Mr. Alexei Teksler Kazakh business part of Polyus and Mr. Adrian Coates as an independent director (who worked, in particular transactions in the field of metallurgy in HSBC and UBS). In addition, as reported by Interfax in the "Pole" in the council continues to enter Mr. Aidar Assaubaev. Polyus has completed a deal to buy a controlling stake in KazakhGold in August 2009. Before that, the principal owner of the Kazakh Company is the family of Assaubaev family. In particular, the "Pole" in the deal bought 41.82% shares owned by Gold Lion Holdings owned by Assaubaev family. Fixed assets KazakhGold, largest gold producer in Kazakhstan - the deposit Aksu, Bestyube and Zholymbet located in the northern part of the republic. These three fields combine stocks of about 60 million ounces over the past 2 years have produced more than 300 million ounces of gold. On the field Aksu has two gold-mining plants (ZIF) and the object heap leaching at Bestyube - mill and heap leaching at Zholymbete - mill. In addition, all three fields is the construction of additional facilities (up to 2 million tons of ore each) for processing of tailings. According to analysts JSC "BCC Invest" This news is neutral for the GDR KazakhGold for the securities of its parent company, Polyus Gold. Analysts do not see KazakhGold separately from the parent company. JSC "BCC Invest" saves the current recommendation of "buy" on the ADR CJSC Polyus Gold, traded on the London Stock Exchange. Analysts JSC BCC Invest also expect the following developments in international markets: - Russian markets are now expected to yield regular data on the status of the monetary base in narrow definition of the ruble at the beginning of the week. In the corporate sector are now expected annual meetings of such companies as OJSC "Polyus Gold", OJSC "Magnitogorsk Iron and Steel Works (MMK), and so on. At the opening of trading on Friday, analysts of JSC "BCC Invest" expected negative market dynamics that may occur against the background of avalanche close of business in the U.S. yesterday. However, analysts do not rule out that during the day Russian indices bounce up against the very sharp fall in the last two trading sessions and closing of short positions at the end of the week. - European markets today will be revised data on GDP growth in Germany in the first quarter of this year, which changes are not expected. Also today, come out values of the indices of industrial activity in the euro area in May, as well as the index of activity in the services sector during the same period. In the UK there are data on net borrowing of the public sector in April. - U.S. market today release of important macroeconomic data is not expected. Analysts of BCC Invest JSC are giving the following advice for investors in securities of issuers in internal market: ---------------------------------------------------------------------- Issuer Last price Target Predicted price, code price % Recom- mendation ----------------- ------- ---------- ------ ---------------- --------- Kazkommertsbank KKGB 489.50 623 +27.27 Hold KKGBp 271 312 +15.13 Hold Halyk Bank HSBK 280 330 +17.86 Hold Bank CenterCredit CCBN 530 777 +46.60 Buy Tsesnabank TSBN 941 737 -21.68 Cut KazMunaiGaz RDGZ 18,000 21,300 +18.33 Hold Kazakhmys PLC GB_KZMS 2,400 3,559 +48.29 Buy ENRC PLC GB_ENRC 2,100 2,642 +25.81 Hold Kazakhtelekom KZTK 13,200 17,800 +34.85 Hold KZTKp 6,001 10,300 +71.64 Buy MREK MREK 910 800 -12.09 Cut ---------------------------------------------------------------------- The given material has exclusively information character and is not the offer or recommendation to make any transactions with the stocks. Agency Irbis doesn't take responsibility for the opinions which are in given material. [2010-05-21]