OREANDA-NEWS. January 14, 2011. The Stakhaniv Railcar, the major Ukrainian railcar producer, plans to boost its output by 21% in 2011, as company spokesman announced on Jan 10.

We see the news as POSITIVE for SVGZ. The suggest the company will have no problems with selling additional output since its current capacity seems to be loaded for years out thanks to robust demand for railcars from Russia stemming from recovering global commodities. The only thing remains in question is whether SVGZ will manage to raise its capacity accordingly to meet the target by end-2011. At present the plant can produce c.7,500 railcars per year and it should take quite a bit of funds to raise this level to 9,000 meaning a 21% growth. We point the company can count on financing from VTB-Leasing, its principal customer, while Ukrainian banks should also be willing to lend to SVGZ given its exceptional financial outlook.