09 July 2014 | 13:29

4 Kazakh companies to float in People's IPO

Four big Kazakhstani companies will float their shares during the People's IPO, Tengrinews reports citing Almaty TV channel. These are KEGOC, Samruk-Energy, Kazakhstan Temir Zholy and KazAtomProm.

Kazakhstan Electricity Grid Operating Company (KEGOC) is a national transmission grid operator of Kazakhstan. It is fully state-owned.

Samruk-Energy produces, transmits and distributes electricity in Kazakhstan. It also produces heat, mines coal, constructs power facilities, operates power plants, power lines, and substations, operates thermal and hydroelectric power stations, and designs and constructs renewable energy facilities for the production of electricity and heat from renewable energy sources.

Kazakhstan Temir Zholy (KTZ) is the national railway company of Kazakhstan. Its task is to develop, operate, and maintain railway transportation in Kazakhstan.

KazAtomProm is a state-owned nuclear holding company in Kazakhstan. It produces Uranium, Beryllium, Tantalum and Niobium and operates in the field of nuclear energy and nuclear fuel cycle services.

Kazakhstanis will be able to purchase KEGOC's stock as soon as in December this year, but no preliminary dates for the other three companies are available yet. Only very few details of the campaign have been disclosed so far. Costs and rules and restrictions have not been unveiled.

But it is known that 10 percent minus one share in KEGOC is going to be floated. The main advantage of the People's IPO is that shares will be sold at their nominal value, that is, the lowest price per share at the primary listing bid. And the new holders of the floated stock will be able to start receiving dividends on their stock in one year after the purchase.

Financial analyst Sailau Kalizhanuly explained that there were two ways to profit from the securities: to wait for an increase in the price of the stock and then sell it, or to keep the stock and receive dividends on a regular basis: sometimes companies distribute up to 40-50% of their total gain to shareholders in dividends.

Almaty resident Clara Yesmagambetova shared that she had purchased 100 shares of KazTransOil back in the day (KazTransOil was the first company floated as part of the People's IPO). "This is my second year receiving dividends. On the first year, the dividend per a share made 75 tenge ($.49), and this year it was 109 tenge ($.63). In any case, I win," Yesmagambetova said, adding that she was planning to purchase stock of four more companies in the upcoming People's IPO.

The People's IPO was launched two years ago. Then, 35 million common shares of KazTransOil were purchased by 34,000 Kazakhstanis. The price of each share was 725 tenge (around $4.83 at the exchange rate of that time). The company raised more than 38 billion tenge ($253.3 million) through the IPO.

Writing by Dinara Urazova, editing by Tatyana Kuzmina

Samruk Kazyna People's IPO news KEGOC Kazakhstan Temir Zholy Kazakhstan Kazakh