3 ноября 2017 г.

The walls of the Moscow Exchange (MoEx) were buzzing with excitement and youthful vigor on the evening of November 2, as CFA Association Russia held the official Kick-Off Event of the 2017-2018 CFA Institute Research Challenge.

Recording of live broadcast of the event is available below:

Around 40 students from 8 different universities, including students from Vladimir State University, who traveled 200-km to Moscow, attended the event. Faculty advisers and several members of the CFA Russia community were also present last night.

The Kick-Off Event is the official opening ceremony of the Research Challenge during which participants are introduced to each other, learn about the rules and official procedures of the competition, and find out the name of a subject company.

This year the subject company is Detsky Mir, Russia’s leading chain of children’s toys retailer. 31 teams from 27 universities, including one school from Belarus and three from Azerbaijan, will compete against each other to determine two best teams which will represent CFA Association Russia at the EMEA Regional Final held next April in Dublin, Ireland. 

Maria Kharlashkina, Head of Capital Market Research & Business Development at MoEx, pointed out that the selection of Detsky Mir as this year's subject company shows the overall growth of the Russian exchange market.

Above: Maria Kharlashkina, Moscow Exchange, and Vladimir Tutkevich, CFA Association Russia

For the second year in a row, students research a publically-traded company that is listed only in Russia [the Moscow Exchange in 2016 and Detsky Mir in 2017]. Previously, students analyzed either offshore companies, incorporated under the laws of a foreign country [Tinkoff and Qiwi], or companies listed both in Russian and foreign exchanges, such as Magnit. 

“This means the financial infrastructure of the Russian exchange market is on a par with its foreign counterparts, and companies now are conducting their IPOs in Russia, as MoEx and the diamond-producing giant ALROSA did in 2013, and Detsky Mir and the Russian shoe chain Obuv Rossii in 2017,” Kharlashkina explained.

The Kick-Off Event began with Vladimir Tutkevich, CFA Russia’s executive director, greeting everyone with a welcoming speech and telling briefly about the history of the Research Challenge in Russia.

He then introduced a keynote speaker, a senior equity analyst from BCS Global Markets, Marat Ibragimov, who gave an intro to the subject company.

Above: Marat Ibragimov of BCS Global Markets

“Over the last five years, Detsky Mir showed a spectacular performance following the arrival of a new management team. They have managed to almost double the store network, raise the EBITDA margin to double-digit rates and boost earnings than tenfold. The key pillars of Detsky Mir’s success are the omni-channel retailing strategy, a market-winning value proposition and asset-light business model,” Ibragimov said.

The analyst added that Detksy Mir shares offer investors an attractive opportunity to benefit from the consumer demand recovery and the ongoing increase of the birth rate. Although quite low in liquidity Detsky Mir shares offer an attractive combination of defensive status and growth story, Ibragimov summed up his speech.

Lastly, Dmitry Ryabykh, a member of the CFA Russia’s educational committee, spoke about plagiarism when doing a company research. 

Dmitry Ryabykh, CFA, CEO of Alt-Invest Group, giving his presentation

“CFA Institute and CFA Association Russia take plagiarism very seriously. Teams found guilty of plagiarism will be disqualified immediately and reported to the CFA Institute Professional Conduct Program. The disqualification of a cheating team is the softest punishment students could get, as under certain circumstances the team’s university may also be banned from participating in the following year’s competition,” Ryabykh reiterated the importance of avoiding plagiarism.

The evening ended with a short Q&A session during which the students had a chance to clarify some of the issues they were particularly keen on learning.

CFA Association Russia would like to thank sponsors: Wiley & Sons Inc, and The Moscow Exchange, companies that helped to put together the 2017-2018 CFA Institute Research Challenge.