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ADR BUY We believe the recent depreciation in the ADR price was due to weak market sentiments prevailing in
global markets. We believe, the current decline in the stock price is temporary as the company
Direct
reported access
robust to theinfull
performance report
1Q 08. free ofFoods
Wimm-Bill-Dann charge
OJSC at
(WBD) registered strong revenue
growth from all segments in 1Q 08. Going forward, we believe strong revenue growth will continue. As
http://www.iirgroup.com/researchoracle/viewreport/show/20146
the current ADR price no longer supports a HOLD rating and in light of strong fundamentals and the
anticipated healthy growth, we upgrade our ADR rating from a HOLD to a BUY.
Ticker: WBD
Target price: US $131.45
Current price: US $111.071
Price change since 4.8% We will reassess the ADR rating for Wimm-Bill-Dann in our next update report.
last report:
Russian BUY We maintain our current BUY rating for the Russian stock as current price levels support our rating
with significant upside potential. The currency impact on the Russian stock is expected to be neutral.
Stock2
Ticker: WBDF.RTS
Target price: US$99.30
Current price: US$74.00
Price change since 1.4% We will reassess the Russian Stock rating (1 Russian Stock =1 ADR) in our next update report.
last report:
In our 4Q 07 and FY 2007 update report, dated 09 April 2008; the fundamental valuation of the WBD
ADR resulted in a target price of US$131.45, representing a potential 24% upside. The ADR achieved
our target price on 16 May 2008, closing at US$134.98 and consequently we downgraded our rating
from a BUY to a HOLD. The ADR has declined 21.1% since then closing at US$105.22 on 30 June
2008. We believe the current decline in the stock price is primarily attributable to the weak market
sentiments prevailing in global markets. Nevertheless, WBD reported strong revenue growth of 34.8%
y-o-y in 1Q 08 due to robust performances from all segments, particularly Baby food and Dairy.
Furthermore, as outlined in our 4Q 07 and FY 2007 update report, we expect WBD to continue its
strong revenue performance, going forward. In addition, we continue to expect margins to display an
increasing trend. In light of these factors, our outlook for the company’s operations remains positive.
Based on the strong fundamentals and expecting healthy growth going forward, we upgrade our ADR
rating from a HOLD to a BUY.
Footnotes
1 We have taken prices for the ADR and Russian stock as of 20 June 2008, as the Russian stock has not traded meanwhile. The ADR price
closed at US$105.22 on 30 June 2008.
2 The WBDF.RTS stock has a low average daily trading volume of below US$1 mn, over the last twelve months.
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