Constantly thinking over the purchase of global giants’ shares, we often consider our dreams unfeasible and give up the idea about investing. What if it is time to try? A bird in the hand is worth two in the bush!
In other words, it is better to invest a reasonable sum in shares of a local promising company than to dream about unattainable global corporations. You may ask whether there are such companies in Russia. In fact, there are dozens of them, but today we will take a close look at Rusal. It is high time to learn about the achievements of one of the global producers of aluminum and find out all pros and cons of investing in the company’s shares.
About company
Russian company Rusal is one of the leading producers of aluminum and alumina in the world. The net cost of the products is the lowest among rivals. Rusal is mainly focused on the production of primary aluminum, foil, aluminum alloys, and alumina. The better part of the production facilities is located in Siberia, whereas the firm is headquartered in Moscow.
Today, the company’s staff totals more than 55,000 people. The organization itself consists of a complex of enterprises, including mining plants as well as aluminum, foil rolling, and alumina factories.
United Company Rusal entered the market in March 2007. Its assets are located in 13 countries worldwide. Notably, Russia remains the key sales market.
Analysts are sure that thanks to rich bauxite deposits developed by Rusal, the company will hardly face a deficit of raw materials in the next 100 years.
Rusal stock
Today, 17% of the company’s shares are in free circulation. They are traded under the ticker of RUAL on the Moscow and Hong Kong exchanges.
Large Russian and foreign investors are the main holders of Rusal’s stocks.
Investors may get a profit from either price changes or receiving dividends.
To purchase shares, traders should open a trading account with a broker that offers access to large financial markets. It will take just several minutes. For example, to register an account with InstaForex, you need only three minutes.
The minimum trade size is 1 lot that stands for 1 share. To calculate your income, use Forex calculator on the InstaForex website.
Then, you may start trading, by selling and buying shares of this or other popular companies. The MT4 trading platform developed by InstaForex is highly likely to become your best assistant.
You can get the real time information about Rusal’s shares and the state of the global aluminum segment in the FOREX ANALYSIS&REVIEWS section on InstaForex website.
Factors that may affect Rusal’s stock price
According to experts, the company has bright prospects. However, the market price of the aluminum producer’s share depends on various factors.
• Rusal’s financial results
• Changes in currencies exchange rates
• Price of aluminum and raw materials
• Global economic condition
• State of affairs in the world
• Changes in tax policies
• Customs duties
To make its stocks more attractive for investors, the company should do the following:
• Plan big project for the future
• Continue increasing the share of products with high added value
• Retain the production profitability at the leading positions on global markets
• Reintroduce the dividend policy
• Enter the largest global indices
Notably, the outbreak of Covid-19 has had a considerably positive effect on Rusal’s shares . Since March 2020, when the Global Health Organization announced the coronavirus pandemic, the company’s stock price has surged by a stunning 262.70%.
Rusal dividend policy
Dividend payments are a part of income that holders of shares receive from the company. To pay dividends, Rusal should receive a net profit and then divide it between its shareholders. At a particular meeting, the company’s shareholders settle the size and date of payments.
According to the amendments to Rusal’s dividend policy made in 2015, the minimal dividend payment totals 15% from covenant Ebitda*. In addition, the size of payments depends on the company’s financial results and other factors.
Last time Rusal paid dividends to shareholders in 2017. Later, the company failed to meet the obligations due to the US sanctions imposed in April 2018. Notably, the US withdrew its sanctions in January 2019.
At a special meeting held on September 9, 2021, Rusal’s biggest shareholders voted against dividend payments in the current year.
*Ebitda is a measure that equals the sum of revenue together with expenses (taxes, depreciation, amortization, etc.)
Conclusion
Today, Rusal’s share price remains rather low compared to the cost analysis. It is quite possible that after the examination of cash flows and dividend payment policy, potential investors will choose a more attractive asset to invest in. However, for some investors, shares of one of the largest global producers of aluminum could become a perfect opportunity in the long term.
If the above-mentioned information is a strong argument to become a part of Rusal by investing funds in its shares, visit InstaForex website and open a trading account in a jiffy.