The item has been submitted to the AGM for the purpose of cancellation of shares acquired by LUKOIL SECURITIES LIMITED (a 100% subsidiary) as part of the buyback program announced on August 30, 2018. Should the AGM Meeting resolve on the matter, LUKOIL SECURITIES LIMITED will submit its Lukoil shares for sale. The acquisition of the ordinary shares by the Company will be implemented via a public offer at a price of 5,450rub/share. The number of shares to be acquired is 35,000,000 shares. Acquisition of such a number of shares and their cancellation will reduce the charter capital of PJSC "LUKOIL" to 715,000,000 ordinary shares. If more than 35,000,000 shares are submitted for sale, the acquisition of shares will be implemented on a pro rata basis.
Our view
Given the noticeable drawdown on Lukoil shares to 5,000rub/share, the news yesterday was received by the market positively - the shares rose to 5,200rub/share. We view the news as moderately positive for the value of shares, noting the presence of a fundamentally strong assessment, which prevails as a catalyst for growth and, moreover, has a long-term character. We maintain our “Buy” recommendation with 12M TP of 6792rub/share.
