OREANDA-NEWS. September 23, 2010. Finance Minister Kudrin was quoted by Reuters as saying that a decision on the stock options programs for Sberbank and VTB should be made by year’s end, with his expectation that this would probably occur sometime between late-September and mid-October, reported the press-centre of OTKRITIE Financial Corporation.

View: Because we see approval of stock option program as necessary for Sberbank to move forward with its DR program, we view the comments clarifying the timeframe for decision-making as a positive development for the stock. However, we think such time guidance is close to what markets have been expecting, as Sberbank's CEO German Gref was recently quoted as saying that a DR program could be introduced already this year. Likewise, VTB has mentioned that it anticipates a decision on its options program by YE10.

Valuation and Action: We believe the DR program is one of the major catalysts for the stock’s performance, so movement towards its realization could support the share price in the coming months . Sberbank's shares are currently trading on a P/BV 2010 of 2.0x and on a 2011 P/BV of 1.6x. Our target price implies a 52% upside for the stock. We reiterate our BUY recommendation for Sberbank.