RDV Analytics Profile picture
Nov 10, 2021 β€’ 10 tweets β€’ 12 min read β€’ Read on X
πŸ’Έ Is hyperinflation a reality? How to protect yourself?

Money may well depreciate at times. This has already happened before, even in developed countries. #Inflation in developed world is accelerating, and the authorities are carried away by populism. Image
β€’ In the #US, inflation has already accelerated to 6.2%
β€’ In #Germany, it reached a 28-year high of 4.5%.

Authorities of developed countries put above #inflation problems of #SocialJustice in labor market (employment in all minority groups is important) and #climate warming. Image
Populist views are capturing the minds of monetary authorities, which only fuels #inflation. This was the case in the #USA in the 1970s: prices almost tripled.
And sometimes it was much worse: in Israel in the 1980s, prices for goods jumped ~10,000 times. Image
Look at this terrifying picture: in #Germany in the 1920s, prices rose millions of times. Cash, deposits, #bonds were essentially zeroed out.

The world is now on the verge of a new possible inflationary round. Image
πŸ‡·πŸ‡Ί RDV's anti-inflationary portfolio consists of companies that are competitive and cheap both in #Russia and world:

β€’ Norilsk Nickel - #metals: #platinum, #palladium, #copper, #nickel
β€’ #PhosAgro - #fertilizers
β€’ #Lukoil - #oil
β€’ #Rosneft - oil
$GMKN $PHOR $ROSN $LKOH #OOTT Image
RDV's anti-inflationary portfolio. How the list of companies is defined:
β€’ Historically, commodities are best defenders against #inflation: #oil, #food, #fertilizers, #metals.
β€’ There are many raw material companies in #Russia, and many of them are best in the world. Image
β€’ Emphasis on companies that mainly #export, that is, will not fall under the domestic Russian price control.
β€’ Companies with high margins will painlessly tolerate the rise in prices for raw materials required for production.
What can we do with you to protect ourselves from inflation? Buy producers of #oil, #fertilizers and #metals. Historically, their stocks have outpaced inflation and were above or at the level of #inflation. Image
πŸ›’ Russian oilers are best option to participate in rise in oil prices. The leaders of RDV in sector are #Rosneft and #Lukoil.

1️⃣ High efficiency. $RNFTF and $LUKOY spend $3–3.5 per barrel on #hydrocarbon production vs $10–11 per barrel for #ExxonMobil $XOM and #Chevron $CVX.
2️⃣ High divyield. By end of 2021, Russian #oil companies will provide an average 8-12% of #dividend yields, while global peers will provide 3-4%

3️⃣ Growth potential. Average EV/EBITDA multiple for 2022 for Russian #oil companies is 4x, and for global peers - 6x
$LKOD $LKOH $ROSN

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More from @rdv_analytics

Mar 23, 2022
πŸ”₯ What does transition to sale of #gas for rubles mean? #ONGT

β€’ #Russia will continue to receive foreign exchange earnings: Europeans will buy rubles for euros, since they do not have their own rubles.
1/5
β€’ State is losing interest in a weak ruble. Weak ruble was beneficial to #Russia, since budget received revenues in foreign currency, but spent rubles.

β€’ Foreigners need to hedge risk of ruble appreciation. They will be forced to keep ruble balances or sell EURRUB futures.
2/5
β€’ Moscow Exchange will develop: both currency trading and bond market. The same #Gazprom will switch to loans in rubles, the Europeans will need to somehow place their rubles. $GAZP

β€’ Next, we may move away from the accumulation of "unfriendly" currencies in gold reserves.
3/5
Read 5 tweets
Mar 23, 2022
⚑️ How much could Chevron stock tumble?

A storm in Black sea stopped all $CVX oil exports from #Kazakhstan.

It turns out that 30% of Chevron oil production was heavily reliant on Russian #oil transportation system, which makes $CVX expose to russian risks.

Thread πŸ§΅πŸ‘‡
CPC transports oil from northwestern part of #Kazakhstan to Novorossiysk for further transportation by sea.
During 2021, CPC transported an average of 1.3 mn barrels of crude #oil per day, composed of 1.1 mn barrels per day from Kazakhstan (~75% of Kazakhstan's exports).
2/10
Due to storm in Black Sea, oil loading at sea terminal of Caspian Pipeline Consortium near Novorossiysk was completely stopped. Pumping of #oil through CPC system is still going on, but tank farm will be full by the evening, after which it will stop.
kommersant.ru/doc/5270959?fr…
3/10
Read 10 tweets
Feb 9, 2022
πŸ‡·πŸ‡ΊπŸ‡ͺπŸ‡Ί To what extent does #Europe depend on Russian raw materials?

Policymakers fear the bloc is less prepared than Moscow. EU anti-Russian sanctions - shot yourself in the knee.
ft.com/content/26d7e3…
β€’ about 40% of natural #gas imports;
β€’ almost a third of crude #oil imports.

Eurozone gas inventories are below historical levels and prices have risen sharply in recent months, giving #Russia additional leverage over #Europe.

#OOTT #ONGT
β€’ about 40% of #palladium imports, which are needed for emission control catalysts; #greeneconomy
β€’ about 30% of #titanium imports, which are critical for #EU aerospace industry - #Airbus supplies about half of its titanium from #Russia. $AIR
Read 4 tweets
Feb 9, 2022
β‚Ώ The ban is canceled: new concept of #cryptocurrency regulation in #Russia.

Which Russian companies have already prepared?

Thread πŸ§΅πŸ‘‡
For Russian investors, #cryptocurrencies have become important asset class – there are twice as many funds in crypto accounts as in brokerage accounts. Ban could have a negative impact on credibility of Central Bank and the authorities in general.
bloomberg.com/news/articles/…
πŸ” If you can't win - lead!

Central Bank, together with Ministry of Finance, found best way out of situation instead of a complete ban - to allow trading in #cryptocurrencies through banks, which will make all transactions transparent to Central Bank.
Read 6 tweets
Feb 8, 2022
πŸ‡·πŸ‡ΊπŸ‡«πŸ‡· Main from press conference following the talks between the presidents of #Russia and #France

#Putin:

β€’ They don't do anything themselves, but they demand some kind of performance from us. Let's not play like that - on the situation around #NATO and #Ukraine.
1/6 Image
β€’ A number of #Macron's ideas, which are still too early to talk about, are quite possible to form the basis for further steps in #Ukraine.

β€’ If you like it or not, be patient, my beauty, you must comply - on #Kiev's attitude to #Minsk agreements.
2/6
β€’ #Russia's central concerns about security assurances have been ignored by #US and #NATO.

β€’ We agreed with #Macron to continue mutually beneficial cooperation in economy, politics, cultural and humanitarian spheres.
3/6
Read 6 tweets
Jan 19, 2022
❓ How will the confrontation between Russia and the West develop further?

Military operations, prolongation of the conflict, the split of Ukraine. Three opinions from RDV sources.

Thread πŸ§΅πŸ‘‡
πŸ‡·πŸ‡ΊπŸ‡¨πŸ‡³ China and Russia will unite against #USA. #Putin travels to #Beijing on February 4. #Russia is fighting, #China is paying. China benefits because it weakens #UnatedStates and diverts its attention from itself.
1/3
πŸ‡ΊπŸ‡ΈπŸ•” #US will "eternally" delay resolution of conflict. Russia is trying to obtain guarantees to limit #NATO's eastward expansion, when there is a shortage of #oil and #gas. It will be difficult for #Europe to agree to Iranian scenario, other scenarios for Russia are not terrible
Read 6 tweets

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