Kryukiv Wagon lifts railcar production 18.8% yoy in 4M08

Kryukiv Wagon (KVBZ: HOLD) increased output 18.8% yoy to 2,460 railcars, including 23 passenger railcars (+11.5x yoy) in 4M08, according to news reports yesterday citing an undisclosed source within the company. He said that Kryukiv Wagon plans to lift cargo railcar output by 100 units in May, June and July, and to increase production to 950 railcars each month. The source attributed the output growth to increased casting supplies from Kremenchuk Steel Casting Works. Inna Perepelytsya: The information in this news contradicts Kryukiv Wagon’s monthly capacity of 700 railcars. We retain our forecast (7,650 cargo wagons and 80 passenger wagons for 2008) until we clarify these figures. Our current target price suggests 17% upside.