Vladimir Putin’s return to the Russian presidency is “positive for the market, positive for Russia” as it reduces investor uncertainty and will pave the way for more reforms, according to Mattias Westman.
Putin has been associated with “immense progress” in Russia over the past 12 years, Westman, managing director of London-based Prosperity Capital Management, which has about $5 billion of Russian assets under management, said in an interview on Bloomberg Television from Moscow.
The protests that ensued following the disputed Dec. 4 parliamentary elections are a good thing as they show that people are becoming more vested in the nation’s politics, something that will spur reform, Westman said.
Russia, where the Micex Index trades at the lowest valuation among 21 emerging markets tracked by Bloomberg, is cheap because of investors’ “misconceptions” and “prejudice,” he said. While gas monopoly OAO Gazprom is “not a very well run company,” its valuations make it attractive, Westman said.
Prosperity has had so-called long positions on Russian stocks, or bets on gains, for the past 15 years, he said. Investors exaggerate the importance on politics in Russia and should focus more on reforms being made in the corporate sector, Westman said.
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