OREANDA-NEWS. July 21, 2010. Rosstat released macro data for June, revealing retail turnover real growth of 5.8% YoY, while the Russian food retail sector showed nominal growth of 11.7%, reported the press-centre of OTKRITIE Financial Corporation.

View: The results indicate the continuation of a positive trend that started in October 2009. Rising retail turnover should be positive for Russian food retailers such as X5, Dixy, and Magnit.

Valuation and Action: X5 trades on a 2010 EV/EBITDA of 10.5x, which is a 21% discount to EM peers, while Dixy trades at 7.0x, implying a 47% discount to EM peers. We reiterate our BUY ratings for X5 and Dixy, with target prices of USD47.1 and USD10.7/share, respectively.