OREANDA-NEWS. January 14, 2010. Magnit has announced the initiation of an Employee Stock Option Plan. The total expense is to be limited by 7% of 2008 net income. The program, which will last from 2009 to 2011, could amount to 147,357 shares, reported the press-centre of OTKRITIE Financial Corporation.

View: Since the bottom line effect is limited to 7% of 2008 net income, we see this news as neutral. The company is still to decide whether this will be a one-time expense in 2009 or if it will be distributed over the period 2009-2011.

Valuation: The stock trades on a 2010 EV/EBITDA of 10.6x, which is a 13% discount to EM peers.

Action: We believe the news will have only a limited impact on the share price, at best.