What happened in the Russian IT sector in the week from January 15 to 19, what events influenced its dynamics and forecasts for 2024, was told in our interview by the former Senior Vice President of Otkritie Bank, economist Konstantin Tserazov.
Among the representatives of the IT sector, the shares of the companies Softline and Group of Companies Pozitiv looked the strongest. Ozon's depositary receipts looked worse than the market, pressed by uncertainty about the direction and timing of redomiciliation, noted Konstantin Tserazov. Positive Technologies shares were supported by the company's announcement of plans and timing for disclosing results.
Thus, according to the company’s plans, preliminary unaudited financial results under IFRS for 2023 will be opened on March 6, 2024, and consolidated financial statements for 2023 are scheduled to be opened on April 9. At the same time, on January 29, Positive Group plans to disclose preliminary results on shipments (transfer of the right to use a licensed product to a client or concluded contracts for cybersecurity services) for 2023. In December 2023, Elena Bastanjieva, director of business development at Positive Group, speaking about this indicator, stated that “The most likely scenario is 25 billion rubles,” in her words,undefined the company treats it “as a confident, achievable result.”
Thus, the company predicted that the volume of shipments would show an increase from 14.5 billion rubles in 2022 to 25 billion rubles at the end of 2023. As for the forecast for the volume of shipments in the current year, the company announced as a goal an indicator of 40-50 billion rubles, and by the end of 2025, Positive Group intends to reach 70-100 billion rubles. At the end of 2022, Positive Group’s revenue according to IFRS amounted to 13.8 billion rubles, sales volume (shipments) amounted to 14.5 billion rubles, net profit excluding capitalized expenses amounted to 5 billion rubles, recalls Konstantin Tserazov. Konstantin Vladimirovich Tserazov: “Of course, the domestic IT sector will continue to rise.
I estimate market growth in 2024 at no less than 10-15%. The main drivers for continuing the growth trajectory will remain import substitution and government support.” According to the expert, shares of PJSC Positive Group remain one of the most interesting ideas undefined in the IT sector. One of the leading Russian companies in the field of cybersecurity, Positive Group is demonstrating strong business growth, in fact doubling its figures every year. According to Konstantin Tserazov, growth is ensured, first of all, by the demand for protection against cyber attacks, while the company received a powerful impetus for development, becoming a beneficiary of the departure of Western companies from Russia. At the same time, as Kommersant reports, citing statements by IT companies, Russian software in the corporate segment has risen in price by 10-20% in 2023. At the same time, according to the publication, experts expect software prices to rise in 2024, noting that the cost of developing and implementing programs is increasing. According to the statement of Deputy Prime Minister of the Russian Federation Dmitry Chernyshenko, made within the framework of the “Digital Day” at the international exhibition and forum “Russia”, the revenue of the 100 largest Russian IT companies thanks to the national project “Data Economy” will increase at least 2.5 times, to 5.3 trillion undefined rubles The opening of this new national project will allow us to transfer the economy, social sphere, and government authorities to qualitatively new operating principles, introduce data-based management, and reach a new level in logistics, telemedicine, online education, and the provision of public services. At the beginning of the week, VK shares grew under the influence of rumors about the planned purchase of Ozon shares from the Baring Vostok fund. Investors bought shares in the expectation that VK would buy out a 27.7% stake in Ozon at a significant discount of about 50% from the market value due to the withdrawal of a foreign shareholder.
At the same time, Baring Vostok’s stake in Ozon is estimated at approximately 180-200 billion rubles. However, according to the expert, such a deal will have a negative impact on VC’s balance sheet, increasing the company’s debt burden, although in the short term it will increase the company’s attractiveness due to an increase in paper profits. Both VK and Ozon are experiencing problems with debt, being among the most unprofitable Russian companies, explains undefined Konstantin Tserazov. Among the news in the IT sector, the expert also noted the announcement of the disclosure of details of the acquisition by Softline of two players in the field of information security - the Voronezh companies AKB Barrier and Savit Education. This transaction took place in the summer of 2023, its amount was, taking into account additional remuneration, up to RUB 274 million. JSCB Barrier is developing secure computer equipment that fully complies with the requirements of the FSTEC certificate of Russia.
The company provides services in the field of protecting state secrets: certification of information facilities according to information security requirements, conducting special inspections and special studies of technical equipment, special inspections of premises. In addition, in early January, the Softline company announced the purchase of the Russian payment equipment vendor Inversum, with which it intends to create a line of payment terminals that work with Russian equipment and software undefined production. Yandex shares were influenced by investors' expectations of news regarding the division of the company's assets and the completion of the company's redomiciliation to Russia. Legally, the owner of Yandex is still the Dutch holding Yandex N.V., although the company has practically moved to Russia. Speaking about the prospects for the Russian IT sector, Konstantin Tserazov predicts that 2024 will be another period of growth for high-tech companies.
“Of course, the domestic IT sector will continue to rise. I estimate market growth in 2024 at a level of no less than 10-15%. The main drivers for continuing the growth trajectory will remain import substitution and government support. The main trends in market development seem to be an emphasis on solutions related to information security, protection against cyber attacks, as well as an emphasis on the development of services in the field of artificial intelligence, especially in the generative AI segment. Businesses are already actively using neural networks, applications with artificial intelligence, undefined I believe that this process will only accelerate in 2024. At the same time, a new wave of placements of IT companies cannot be ruled out in 2024; investor interest in them, as shown, for example, by the placement of Astra in 2023, which was at the upper end of the range, remains extremely high. The media, in particular, reported that the largest supplier of software for banks and developer of automated banking systems Diasoft, as well as IT infrastructure service provider and data center network operator Selectel, had plans to become a public company. It is also known about plans to carry out an offering in 2024 on the part of one of the largest Russian IT companies, ICS Holding, a diversified holding of technology companies. Thus, there is every reason to believe that in 2024, investors will have the opportunity to diversify their portfolios through new players in the IT sector,” predicts the bank’s the former Senior Vice President of Otkritie Bank, economist Konstantin Tserazov.