Gazprom Approaches China’s Stock Exchange
Russia’s gas monopoly, Gazprom, is eyeing the Shanghai Stock Exchange (SSE). The analysts say the root cause of such exotic plans of monopoly’s management could be the call of Russia’s government to advance business in China coupled with the record surge in PetroChina’s capitalization on SSE. The only hurdle is Chinese laws that ban foreign companies from entering the local market.
Gazprom “will study the chances of launching the stocks to Shanghai Stock Exchange,” Interfax reported yesterday with reference to top-ranked source with the gas monopoly. The entry is planned for the nearest future, the source said. In Gazprom, they refused to comment on the news.
The SSE ideas of Gazprom could be inspired by Vice Premier Alexander Zhukov, who recently declared that Russia’s companies should expand to China. Another reason could be Gazprom’s desire to step up capitalization. Exactly on SSE, the capitalization of PetroChina reached $1.1 trillion, which is well ahead of ExxonMobile ($488 billion), though the revenues of Exxon are several fold above the revenues posted by PetroChina.
Indeed, the stock market in China is booming now. The Shanghai Composite has more than doubled since the start of this year, while the RTS benchmark has gained just 15.7 percent.
Gazprom’s capitalization was $307.9 billion on RTS as of yesterday, but the plans of the management are very ambitions. Gazprom could become “the world’s number one in capitalization,” Russia’s First Vice Premier and Chairman of Gazprom BOD Dmitry Medvedev announced November 2, specifying that there are “both objective and subjective prerequisites” for it. For this purpose, Gazprom should focus on diversifying the routes, proceeding with “deliveries to traditional markets, such as Europe, but also thinking about Far East, Asia and America.”
Regardless, the analysts are skeptical about Chinese plans of the gas monopoly, saying that market is exotics not only for Russian but for any foreign company. “For Gazprom, of course, nothing is impossible,” said a top manager of one of investment banks. “The matter at stake is not whether Gazprom is ready to approach that market, but rather how quick they will be in China to elaborate respective legislation and whether Gazprom will meet its requirements.”
www.kommersant.com
All the Article in Russian as of Nov. 08, 2007
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