Freight railcar prices grow to USD 70k per unit
16 February 2011
Freight railcar prices by Ukrainian railcar plants (Stakhaniv Railcar, Kryukiv Wagon) went up to USD 70k per unit in February from USD 60k in 4Q10 and USD 65k in January, industry publication Promishlenniye Gruzi reported yesterday. Yegor Samusenko: This price growth outstrips price increases for key inputs, which leads us believe domestic railcar producers will increase their profitability in 1Q11. Railcar prices are currently above our forecasts for 2011 and since we do not anticipate them to decline, we are reviewing our models to incorporate more favorable market conditions. We now project, in 2011, that Kryukiv Wagon (UX: KVBZ UK) to post USD 128 mln in EBITDA (18.5% margin) and Stakhaniv Wagon (UX: SVGZ UK) to earn USD 75 mln in EBITDA (15% margin). We place our recommendations on both stocks under review.
