MARKET SIGNALS

IDEA #1: General Electric Company

In the segment of relatively high-rated securities, we note the Eurobonds of one of the pillars of American industry General Electric Company. Founded in 1872, the company produces locomotives, power plants (including nuclear reactors), aircraft engines, medical equipment, household appliances, as well as a wide range of military products. The company employs 283 thousand people. The headquarters is located in Boston (Massachusetts, USA). The company’s shares are traded on the NYSE with a current market cap of $ 78 billion.

The senior unsecured issue in the amount of $ 5 billion (securities remaining in circulation for $ 3 billion) was placed in March 2002. The issue market is global. Options for revising the coupon (6.75% per annum) are not provided. The face value and the minimum lot on paper are $ 1,000. Eurobonds are serviced by NSD.

GE 6 3/4 03/15/32 issue looks very competitive amid comparable credit quality papers

IDEA #2: TCS Group

The news about the start of trading today from the TCS Group global depositary receipts on the Moscow Exchange prompted us to pay attention to this issuer. Recently, Fitch upgraded Tinkoff Bank’s rating (part of TCS Group) by one notch – to BB with a “stable” outlook. Fitch notes the strong performance dynamics of the bank, supported by continuous diversification and growing business volumes. Note that Moody’s holds the issuer Ba3 rating, which is one notch lower than Fitch.

After the repayment of a subordinated issue of $ 200 million last summer, Tinkoff Bank was left with only an “eternal” Eurobond with the closest call option in September 2022. In our opinion, it has lagged a bit behind the market lately and looks interesting in general against the background of both Russian and international analogues.

Alexey Shternshis
Joint Managing Director
Сapital Pi