Market Analysis

Information Unit (part of the investment holding company "Finam") held a conference "Aviaotrasl Russia at the Crossroads. The participants state that the airline industry in Russia was one of the most affected by the crisis. This year, the volume of passenger transportation by domestic airlines may recover, but the growth of profits has no need to talk - to stimulate demand can only lower prices, while cost carriers remain at a high level.

The situation in Russia"s air transport industry remains difficult. "Civil Aviation of Russia from the crisis did not come out. Anyway, it talked about this performance of air transportation. It can hardly be proud to claim reductions in traffic volumes fall, they continue to excel in times similar to those seen in developed countries. At about the same, apparently , to the financial results. Revenues from transport decreased by 8.3%, the loss of transport activities - 6 billion. also increased the cost of airport services, rental and leasing of AC, MRO. And though, like, fuel is cheap, at most actually it was transformed to a rise in the cost of services for fuel, "- said president of the Partner of Civil Aviation" Oleg Smirnov.

This view was shared by the head of analytical department of the Criminal Code Ingosstrakh-Investments Eugene Shago: "The main factor in reducing the volume - the decline in household incomes and business profits. Some delayed or canceled vacations, while others have reduced travel. The fall revenue impact on the profitability of the airlines industry and so are usually on the brink of loss. Thus the main item of expenditure, the cost of fuel, fell not much: oil prices (and, consequently, on kerosene) recovered very quickly. "

However, according to analysts, in 2010 the industry can demonstrate the growth of traffic. "This is explained by the gradual overcoming of the crisis in the economy and the existing system of transport communications in the country. There are a huge number of places you can reach only by air - means air in 2010 will, and they can grow in comparison with the Year 2009" -- said a leading expert UK "Finam Management" Dmitry Baranov. His predictions voiced by Mr. Shago: "In 2009, Russia"s transport of passengers and /to have fallen to 9,4%, goods - by 8,6%. In 2010 while Preconditions for growth can be expected within 10-15%" .

This increase in the number of passengers does not mean an automatic increase in revenue of the industry. For example, the editor of the analytical department of the agency "Airport" Oleg Panteleyev, says: "Prospects for the volume of traffic is quite bright - it is possible to reach the level of 2008, and even surpass it. But this can only be achieved at the cost of damages. Airlines in 2009 not to raise tariffs, even though their costs rose.ea8If the carriers continue to ready to step up the losses, they will be able to keep low prices. The only question is, what there is a margin of safety for airlines.

In these circumstances, analysts do not recommend investors to bet on shares of airlines. "Economics and /k seriously affected by the crisis, began to fly lower and the fuel is still expensive. The main driver for carriers" shares - income growth, and this is very bad. Why wait for the return of quotations on the level of 2007, I have now did not. Although it should be noted that all public companies: Aeroflot, Utair, Siberia, Transaero - survived the crisis, and some survived well. All substantially upgraded park and is now less dependent on fuel prices. So in the long term 2-3 years and can speak about growth stocks. Provided, of course, that revenue will recover, "- says Mr. Shago.

Department of Public Relations and Media Investment Holding Finam.
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