Sberbank: Leading Russian Retail Bank

Daniel Gladis presented his in-depth investment thesis on Sberbank (Moscow: SBER) at European Investing Summit 2015.

Sberbank is the leading Russian retail bank holding nearly half of Russian deposits and about a third of Russian loans. The bank has performed surprisingly strongly during the real life stress test – the current deep recession – being profitable in every single quarter with profitability bottoming during the last winter. If, during the next 2-3 years, the bank returns to its normal profitability, then the current stock price indicates PE below 3 and PTB below 0,5. Most investors have at present a very negative view of Russian stocks and it is not difficult to understand why. Improved sentiment may allow investors to appreciate Sberbank´s strong fundamentals – ROE in high teens, ROA close to 2 %, cost income ratio in low 40s and low leverage – a set of numbers that most western banks can only dream of. Sberbank has a huge and sustainable competitive advantage – low cost deposit base and its stock is very cheap.

About the instructor:

Daniel Gladis, based in the Czech Republic, has amassed a market-beating track record since starting VLTAVA Fund in 2004. VLTAVA Fund is a value-oriented, research-driven investment fund focused on investing in good companies run by quality management. Previously, Daniel was Director and Chairman of the Board of Directors of ABN AMRO Asset Management (Czech) from 1999–2004. He was also Director and founder of Atlantik finanční trhy, a.s., a member of the Prague Stock Exchange. Daniel is a graduate of VUT Brno and has authored the best-selling book Naučte se investovat (Learn to Invest).

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