Market reviews and recommendations of BCC Invest JSC (Kazakhstan) analysts for December 24, 2010

/IRBIS. December 24, 2010/ - BCC Invest JSC has provided IRBIS with a survey of main events, market reviews and investment ideas for December 24, 2010. Analysts of JSC "BCC Invest" now expect profit-taking and a small correction before the holidays in the West. JSC "BCC Invest" also notes the following important events in the Kazakh market: - The international rating agency Standard & Poor's upgraded long- term foreign currency rating of Kazakhstan to "BBB", according to a press release from the agency. International rating agency Standard & Poor's (S & P) upgraded the long-term sovereign credit ratings on the Republic of Kazakhstan on the foreign and local currency - to "BBB-" and "BBB" to "BBB" and "BBB +", respectively, according to a news release agencies . Short-term sovereign credit rating on liabilities in foreign currency 'A-3' and national scale rating of "kzAAA" confirmed at previous levels. At the same time boosting short-term sovereign credit rating on liabilities in national currency - the "A-3" to "A-2. Assessment of risk transfer and convertibility for non-sovereign borrowers Kazakh upgraded to BBB +'. Following this, S & P raised the long-term credit rating on liabilities in foreign currency and local currency of the Kazakhstan Development Bank (KDB) - from "BBB-" and "BBB" to "BBB" and "BBB +", respectively. Ratings outlook of Kazakhstan and the BRC is still "stable". "The positive impact on the ratings of the Republic of Kazakhstan, in our view, provides a stable balance the budget after a series of bankruptcies of domestic banks and a sharp deterioration in trading conditions in 2008 and 2009." - Said a credit analyst at S & P Frank Gill. - The international rating agency Standard & Poor's downgraded GAMMA National Company KazMunaiGas (KMG) with GAMMA-5 GAMMA-4 + news agency reported. Rating downgrade is due to the activity of the independent directors on the Board of Directors, as well as shortcomings in internal audit report says S & P. "In contrast to the situation in 2009 in 2010, independent directors personally attended only by a minority of board meetings, which, in our opinion, reduced the possibility of their influence on decision making in the EP. This led to a reassessment of the effectiveness of our system of checks and balances in the company. Despite the fact that management, board of directors and shareholder of companies realize the importance of improving corporate governance arrangements in practice for years has been only very little progress, and in some parameters were observed deterioration - the analyst noted Governance Services Standard & Poor's Mr. Oleg Shvyrkov . - Among the areas in which progress was absent or was negligible, include risk management, strategic planning, and optimization of management, internal audit and controls, financial reporting, investor relations, as well as the practice of compensation management. " - The international rating agency Standard & Poor's changed its outlook on Kazakhstan's Halyk Bank of Kazakhstan "from" negative "to" Stable ", news agency reported. Counterparty credit ratings assigned to this bank - long-term "B +" and short-term "B" - confirmed. "Changing the forecast from Negative to Stable reflects a bearish pressure on asset quality Halyk due to the gradual improvement of the economic situation in Kazakhstan, which helps stabilize the levels of income and capitalization of the bank," - said a credit analyst at Standard & Poor's Magar Kuyumdzhyan. People's Bank Ratings reflect the high level of risk in the economic and banking environment of Kazakhstan (rating on liabilities in foreign currency: VVV/Stabilnyy/A-3; term local currency: BBB + / Stabilnyy/A-3; national scale rating: kzAAA), poor asset quality and the associated high level of reserve for losses on loans, creating significant pressure on profitability, as well as a high proportion of individual customers in the structure of corporate loans and deposits. These risks are partially offset by a good coverage of the client market of the National Bank, the position of one of the leaders of Kazakhstan's banking market (particularly in the retail segment), adequacy of liquidity and capitalization, as well as the fact that the state supports the resource base and capital of the bank because of its systemic importance, the report says. Analysts of JSC "BCC Invest" and expect the following developments in international markets today: - Russia is expected to publish data on monetary base in narrow definition on December 20 and at the refinancing rate on December 31. - in France 17:00 (AST) is expected to publish data on the net change in the number of job seekers and the total number of unemployed. - In the U.S. publication of important economic statistics are not expected due to the holidays. Analysts of JSC "BCC Invest" give the following advice for investors in securities of issuers in the domestic Kazakh market:: ---------------------------------------------------------------------- Issuer Last price Target Predicted price. code price % Recom- mendation ----------------- ------- ---------- ------ ---------------- --------- Kazkommertsbank KKGB 430 479 +11.40 Neutral KKGBp 210 335 +59.52 Buy Halyk Bank HSBK 370 386 +4.32 Buy Bank CenterCredit CCBN 594.982 646 +8.58 Hold Tsesnabank TSBN 865 1,030 +19.08 Neutral KazMunaiGaz RDGZ 17,500 22,300 +27.43 Buy Kazakhmys PLC GB_KZMS 3,580 3,977 +11.09 Hold ENRC PLC GB_ENRC 2,345 2,298 -2.00 Sell Kazakhtelekom KZTK 18,500 19,200 +3.78 Buy KZTKp 8,700 9,300 +6.90 Buy MREK MREK 1,100 1,130 +2.73 Hold ---------------------------------------------------------------------- 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. [2010-12-24]