OREANDA-NEWS. October 01, 2010. VTB-Leasing (Russia) intends to buy the entire output of the Stakhanov Railcar (the major Ukrainian railcar producer) in 2011, CEO of VTB-Leasing announced on Sep 30. According to the protocol signed by the two companies, the average price of one car is USD  55,000. It was also announced that the Russian company would be interested in acquiring the plant altogether lifting its monthly output up to 700-800 railcars. Meanwhile, Vitalii Kasinov, CEO of the Stakhanov plant, stressed that the plant would increase the output to produce 700 railcars per month by the end of 2010.

Millennium Capital considers the news as POSITIVE for SVGZ. If VTB-Leasing brings its plans to life Stahanov plant sales in 2011 are to reach USD  412mn, 30% up yoy. We reiterate our BUY recommendation on the stock with the target price of USD 1.28, implying the upside of 48.1%.