MARKET SIGNALS
INVESTMENT IDEAS
Today we will look at two corporate debt securities as investment ideas for this week: General Motors Financial Company and RSHB
IDEA #1: GENERAL MOTORS FINANCIAL COMPANY
In the segment of “investment” issues, we note the 10-year-old Eurobond of GM’s auto-financing unit, General Motors Financial Company. The issuer works with more than 18 thousand GM dealers around the world, offering financing services for the purchase of new and used cars, as well as car rental. The company employs 9 thousand people. The issuer is a 100% subsidiary of the GM group, the current market capitalization of which reaches $ 54 billion.
A senior unsecured issue of $ 500 million was placed in January 2019. The issue market is global. One call option is provided for on the paper three months before maturity. Options to review the coupon level are not provided. The face value and minimum lot on paper are respectively 1 thousand and 2 thousand dollars.
In our opinion, the release of GM 5.65 01/17/29 looks very interesting against the background of securities of comparable credit quality.
IDEA #2: Rosselhozbank
On Friday, it became known that the RSHB, which had already received 15 billion rubles from the federal budget this year, could be capitalized by another 10 billion rubles. very soon. This was stated by Deputy Minister of Agriculture of the Russian Federation Elena Fastova. According to her, the presidium of the national project committee at a meeting on October 7 may approve the transfer from 2020 of 10 billion rubles. by 2019. Due to this, the bank can increase lending to enterprises that export agricultural products. “If the presidium approves, the bank will receive these funds within a month,” the deputy minister emphasized.
Note that the issue of RSHB looks interesting against the background of subordinated Eurobonds of domestic issuers, offering a yield of just over 5%.
Alexey Shternshis
Joint Managing Director
Capital Pi
