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LUKOIL investment help JPMorgan Russian securities overtake benchmark

LUKOIL investment help JPMorgan Russian securities overtake benchmark


New York, June 26 - Neftegaz.RU.
According to Alliance News, JPMorgan Russian Securities said its net asset value rose in the 1st half of its financial year and it outperformed its benchmark with the aid of its largest single holding, LUKOIL.

The Russia-focused investor said its NAV per share rose 15% to 670.1 pence on April 30 from 581.5p the year before. The firm's return to shareholders, on a total return basis, was 16%, beating its RTS Index benchmark return of 9.4%.

"The most notable positive contributor - and the largest holding in our portfolio - was our exposure to LUKOIL, one of the world's largest oil and gas companies, which reported better-than-expected results for its 4th quarter of 2018. Its profits for the year were up almost 50% year-on-year," said Investment Managers Oleg Biryulyov and Habib Saikaly.

More than half of JPMorgan Russian Securities' portfolio is invested in energy, and benefited from "an improved outlook for energy prices", the investment managers noted.

The company's interim dividend will be considered for declaration in September and is expected to represent most of the dividend for the year. It will be followed by a "significantly smaller final dividend".

Chair Gill Nott said: "The board believes that the investment approach adopted by the investment managers' is the correct one for the Russian market, focussing as it does on well capitalised companies with strong business models, good management and a positive attitude to shareholders interests".

"Investing in Russia is likely to remain something of a roller coaster for the foreseeable future. However, for those with the stomach for the ride, given the fundamentals of the market and the fact that it remains relatively undervalued compared with other key emerging markets, there is a strong case for investment, " Nott added.

Author: Anna Farley


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