Earlier this week, MSCI announced that Ozon, the ‘Russian Amazon’, will be included in the MSCI Russia indices with effect from 27 May 2021. We expect the company to have a weight of around 2% in the MSCI Russia 10/40 index. This marks the continuation of the trend in which Russian equity indices are becoming more diverse. Ozon’s inclusion will provide the Russian index with exposure to the consumer discretionary sector, which had been absent from it.
Consumer Discretionary sector weights in MSCI Russia 10/40 vs the MSCI EM index
Sources: Bloomberg, TKB Investment Partners
Ozon is a top-3 e-commerce player in Russia. The company had its IPO on NASDAQ and Moscow Exchange only very recently, in November 2020. According to Bloomberg, Ozon’s debut was the most successful among Russian companies since 2011 and allowed the company to raise USD 1.2 billion.
Ozon’s inclusion represents the latest step in high-tech companies making their way into the MSCI Russia indices. In 2020, for the first time, two high-tech companies, Yandex (‘Russian Google’) and Mail.ru (‘Russian Tencent’), were added to the indices. In February this year, the holding company of one of the world’s largest online banks, TCS Group, joined the indices as well.
Note: Any references to specific securities should not be construed as recommendations to buy, sell or hold such securities.
Authors: Egor Kiselev, Head of International Business & Investment Marketing; Aleksandra Kuznetsova, Investment Specialist; Marina Tsutskiridze, Investment Specialist