OREANDA-NEWS. October 08, 2009.  The government increased dramatically its privatization plans for stakes in various enterprises, to the effect of RUB80bn (US2.3bn) of budget revenues for 2010E, instead of the current figure of RUB7bn (US220m). Government stakes in more than 450 companies are slated for a sell-off, with transportation and infrastructure enterprises featuring most prominently, reported the press-centre of OTKRITIE FC.

View: The renewed privatization drive is commendable, in our view. The planned privatization revenues will be dwarfed by the anticipated budget deficit of RUB3trln in 2010E, hence the government is not primarily motivated by reducing the deficit with privatization money. Rather we see some evidence of a renewed drive for reform which, in our view, has not been obvious in the government's actions and policies of the past months. This is a positive development in the investment climate in Russia, we think.

Action: We maintain a positive stance on the Russian market. More reforms definitely add to the investment attractiveness of Russia. We would be eyeing stocks in the transportation sector (airlines, railways), as well as the infrastructure space segment (ports) as the best route to gain exposure to this trend.