OREANDA-NEWS. August 10, 2010. Mobile operators implemented special roaming tariffs in the seven regions most heavily affected by the current forest fires. Customers unable to connect to their operator's network will be able to use a different operator. The Big Three, following the recommendation of the Ministry of Communications, have set the cost of outgoing roaming calls at RUB5/min and SMS messages at RUB2 apiece, cheaper than the normal roaming rates. Operators are also limiting access to content services in order to reduce the load on the network, which has experienced an average 30% increase in traffic during the emergency situation, reported the press-centre of OTKRITIE Financial Corporation.

View: At this point we do not expect an impact on P&L, as it is only in seven regions and the lower rates may be offset by increased traffic. The operators may also benefit in terms of public and government relations.

Valuation: MTS and Vimpelcom trade at 2010 EV/EBITDA of 5.1x and 4.2x, respectively.

Action: We expect neutral market reaction on the news.