Emerging markets

India E-tailing Gets Big, and Burns Cash, Fast

11 June 2015
The world's sleeping digital giant is waking up. And coming soon to an IPO near you.
Flipkart, India's Amazon, is on the Move

June 12, 2015

Evolving technology promises to revolutionize the way a vast nation shops and communicates. Online merchants’ sales grow geometrically, as do their losses. Investment banks proclaim they have seen the future, and it works with eye-popping stock-market multiples. Tech investors may feel like they have seen this movie before, but the backdrop is new: India.

Rotten broadband networks and dodgy electricity have kept India, population 1.25 billion, as the world’s sleeping digital giant, despite its depth of engineering talent. A leap forward in cellular, with smartphones selling as cheap as $40 and 3G rates dropping steeply, is set to change all that. The value of goods sold online will double this year to $7 billion, and keep on multiplying to $220 billion by 2030, Goldman Sachs projected in a report last month.

Petrobras Regains Market Favor; Now Comes the Hard Part

02 June 2015
Recent disclosures have eased fears about the kickback scandal, but the company still grapples with debt and heavy development costs.
No Smiles Yet at the Brazilian Oil Giant

 

After years in the financial wilderness because of its mounting debt and widening corruption scandal, Petróleo Brasileiro is showing signs of recovery.

In late April the giant state-owned oil company issued a long-delayed fourth-quarter 2014 earnings report and sought to draw a line under its troubles by taking a 44.6 billion real ($14.1 billion) write-down for overvalued assets and an additional 6.2 billion reais for costs related to the alleged graft. “We have made our best efforts to turn the page on this sad chapter that the company has passed through,” chief executive Aldemir Bendine, who came on board in February, told reporters after the announcement.

Egyptian IPOs. Really?

11 May 2015
Cairo has healthy companies in the pipeline, if the bureaucrats don't mess it up.
Waiting on Big Numbers in Cairo. Photo by Shawn Baldwin, Bloomberg

The Egyptian Exchange roared back to life in 2013 and 2014, with its benchmark EGX 30 index doubling in the 18 months following the July 2013 coup that removed President Mohamed Morsi and his Muslim Brotherhood government from power. The military-backed regime of his successor, President Abdel Fattah el-Sisi, cashed in on that optimistic tide last September, raising 61 billion Egyptian pounds ($8 billion) from its own population through a bond issue to finance expansion of the Suez Canal.

Russia Prepares for an Endless Crisis

26 April 2015
A year after grabbing Crimea, economic stagnation is Russia's new normal.
Drawing by Renaud Vigourt

INSTITUTIONAL INVESTOR

APRIL 27, 2015

A Russian analyst who has monitored corporate credit for the past decade at a Big Three rating agency in Moscow still maintains the habits of the go-go years,enjoying a steak tartare lunch at a plush restaurant just off the capital’s Garden Ring, but his outlook for the country is grim — and not only in economic terms. He worries about the official media’s increasing focus on a “fifth column” supposedly seeking to undermine Russia from within, and about events like the 35,000-strong February march in Moscow, encouraged by the government, that was directed against “internal enemies.” Such efforts to stifle dissent and rally support for the government’s policies toward Ukraine could metastasize into a modern version of Stalinism, he warns.

Time to Buy Iran? Not Quite Yet

26 March 2015
"It's like Turkey with 9% of the world's oil," one banker raves. But investors are in no rush to Tehran.
Axis of Profit?

Iran: The Next Frontier?

Bibi Netanyahu and most of the U.S. Congress may still view Iran as an axis of evil. But a few brave analysts are starting to pitch it as something else: the next great emerging market. “Iran is the largest economy in the world by far that remains cut off from global markets,” says Charles Robertson, chief economist of Renaissance Capital, a London-based investment bank that had a good run in Russia and now wants to expand across the Middle East and Africa. “It’s like Turkey, but with 9% of the world’s oil reserves.”

Sovereign Wealth Funds are Still a $7 Trillion Gorilla

06 March 2015
Savings in places like Russia are dwindling, but the giants will thrive, barring a total oil-price collapse.
Oil Wealth Still Packs a Wallop

March 7, 2015

Sovereign wealth funds swelled to a $7 trillion investing gorilla on a rich diet of oil windfalls, so it makes sense that they would lose some punch as oil prices fall. Marc Faber, a Barron’s Roundtable member and the editor of The Gloom, Boom & Doom Report newsletter, stressed at this year’s Roundtable that a tapering of sovereign-fund earnings would undermine global demand for securities in coming years.

http://si.wsj.net/public/resources/images/BA-BH394_Sovere_G_20150306195926.jpg

Investors Gear Up for Little Bang in Saudi Arabia

03 March 2015
Saudi's new king wants to open a stock market the size of Russia's to foreigners at last. But fine print will muffle the bang.
Tadawul Poised for Take-Off?

Investors Gear Up for Opening of Saudi Stock Market

(Institutional Investor – March 2015)

 

The price of oil may be depressed, but investor spirits in Riyadh are anything but. Anticipation is growing that a long-­awaited opening of the Tadawul, the Saudi stock market, to foreign investors will come as early as next month. Analysts believe the move will provide fresh momentum for the $500 billion market, which has risen by nearly 30 percent since mid­-December. “This will be the event of the year in emerging markets,” says John Sfakianakis, a veteran economist and investment strategist in Riyadh who opened an office there in September for the London-­based emerging markets specialist Ashmore Group.

 

Where is the Emerging Market Oil Dividend?

26 February 2015
Markets of oil importers like Thailand or Turkey should be booming, only they aren't

Oil Dividend Proves Elusive for Emerging Markets

Shares of importers such as South Korea, Turkey, and Thailand haven’t enjoyed the expected boost from lower prices. What happened?.

By 

CRAIG MELLOW

Feb. 27, 2015 11:34 p.m. ET

Emerging Markets

It’s a common, and seemingly commonsensical, assumption these days that if oil-exporting emerging markets like Russia and Brazil have been hammered by sinking crude prices, oil-importing countries must be sailing. The hot performance of the two oil-buying BRICs, China and India, since the crash started last summer seems to cement the theory—except it doesn’t.

Ukraine's Oligarchs at War, With Each Other

10 February 2015
Billionaire Ukrainian governor Ihor Kolomoiskyis a two-edged sword for Kiev.
Will Kolomoisky Get the Last Laugh?

FEBRUARY 11, 2015

Ukraine’s Oligarchs Take to Economic Warfare

Despite his reclusive tendencies, businessman and politician Ihor Kolomoisky is trying to tip economics and diplomacy in his holdings’ favor.

 

By Craig Mellow (Institutional Investor)



http://www.institutionalinvestor.com/Images/519/93390/2015-02-Craig-Mellow-Ukraine-Ukrnafta-article.jpg

UKRNAFTA, THE UPSTREAM OIL MONOPOLY OF WHICH THE STATE OWNS 58 PERCENT AND IHOR KOLOMOISKY’S PRIVAT GROUP OWNS A 42 PERCENT CONTROLLING STAKE. (PHOTO CREDIT: VINCENT MUNDY/BLOOMBERG)

 

The Evil Twins of Emerging Market Debt

25 January 2015
Russia's Gazprom and Brazil's Petrobras are rattling their bond investors, but will probably pay in the end.

Emerging Markets: Sizing Up Debt’s Evil Twins — Barron’s

   By Craig Mellow (Jan. 26, 2015)

 

Petroleo Brasilieiro, better known as Petrobras, and Gazprom are terribly managed companies at the heart of the less-than-brilliantly-run economies of Brazil and Russia, respectively. Both have huge debts, which have become tougher to repay, thanks to diving energy prices and internal factors — a corruption scandal that is paralyzing Petrobras, and international sanctions that are keeping Gazprom out of bond markets.

But could either of these national champions actually default? Not likely, and that may spell opportunity for fixed-income investors who can hold their governance noses. “These credits are priced at distressed levels, while we foresee that they will repay,” says Max Wolman, senior investment manager at Aberdeen Asset Management in Scotland. “We are buying selectively.”

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