Ulyanovsk races

UAZ shares fell by 58% after rising in price by 39 times

Trading in second-tier securities on the MICEX ended yesterday with an unprecedented drop in share prices of the Ulyanovsk Automobile Plant (UAZ, part of the Severstal-Auto group). After a dizzying rise in the first days of the new year, when UAZ shares rose 39 times in price, they fell sharply - by 58%. The market has not seen such ups and downs in recent years - YUKOS shares did not even fall in price by half during the day. Experts find it difficult to name the fundamental reasons for such sharp changes in the dynamics of the value of UAZ shares. They only assume that most likely their purchase by a certain investor has ended, and therefore a correction has begun. The company itself also considers the collapse that occurred yesterday to be stock speculation and does not see any real reasons for the fall of shares.

UAZ shares with a par value of 1 rub. entered the list of non-listed securities of the MICEX on December 29, 2005. Of the total issue volume of 3.7 billion pieces, a maximum of 10% are traded on the free market. From January 10 to January 19, the company's share price increased from 1.85 to 72.49 rubles.

“It is possible that the growth in quotations was stimulated by positive news about Severstal-auto, as well as by the actions of the company itself, which stimulates the growth of the capitalization of its assets,” says Aleksey Butenko, asset manager at Finam Investment Company. In his opinion, a significant increase in UAZ quotes is associated with the start of trading in these securities on the MICEX, which ensured a significant influx of liquidity. Some experts suggest that UAZ shares rose on reports of the Severstal-auto project to assemble and sell Fiat models. But when investors finally figured out that Albea and Palio would be produced not in Ulyanovsk, but in Naberezhnye Chelny at the facilities of the Minicar Plant (also controlled by Severstal-auto), their interest in UAZ faded.

Aton analyst Tatyana Kapustina believes that yesterday’s fall was a correction after the previous growth. “Unless, of course, there was an insider,” she adds. - These papers have been attractive and will remain so. There are generally few auto industry shares on the Russian market, and all of them are somewhat undervalued.” At the same time, she doubts that UAZ shares can rise in the near future, since they are still low-liquid and their number on the market is relatively small.

Gyuzel GUBEYDULLINA, Anna LANDER