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You are cordially invited to the following Zoom webinar:
Kazakhstan Macroeconomic Update
Please join us for Kazakhstan Macroeconomic Update session, where Citi experts will discuss key macroeconomic trends, FX rate and other topics.
This webinar will include FX market overview from Egor Miroshnikov, Head of Markets (Citi Kazakhstan) and followed by macroeconomic analysis from Michel Nies (Citi Research). Michel will provide deep-dive review of key trends and indicators of Kazakhstan economy (inflation, GDP, key rate, growth, etc.), and market outlooks shaping the country’s financial landscape.
Date
Wednesday,
5th of March, 2025
Time
15.00-16.00 Almaty time
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Looks like Kazakh winter ends for most areas this weekend. Although a few snow flurries are predicted, frosts abate next week and precipitation looks modest. A thaw will set in, though lying snow of about 30cm will take perhaps 2 weeks to depart nothern cities which only see positive temperatures in week 2.. I'm not suggesting a great start to March so much as it being a bit less likely to be disrupted by futher winter weather since the first two weeks are predicted to be calm, and warming quickly from the current -5C/-15C. The higher cement volume months start in April.
Snow and concrete in Astana: |
There's a lot of cement needed to build roads even if the surface is asphalt. |
wilo101: Probably asphalt. However, much of the infrastructure associated with roads requires concrete. |
Celeritas - some good research there, but there is a but
Yes this is the relevant question by Wilo
I remember the The Belt and Road Initiative (BRI or B&R), known in China as the One Belt One Road and sometimes referred to as the New Silk Road.
Sure it brought projects that need cement over the years, but how much did STCM gain from several billions spent by China . It will have but not in the long term it seems |
But will they be asphalt or cement roads? |
 In the new road construction season of 2025, Kazakhstan will begin the construction and repair of 13,000 km of roads, Trend reports via the Ministry of Transport of Kazakhstan.
In particular, the construction and reconstruction of roads with a total length of 2,200 km, major and medium repairs on 6,600 km, and the repair of local roads on 4,200 km are planned.
The implementation of ongoing projects for the reconstruction of republican roads, started in previous years, will continue. The total length of these roads is about 1,000 km. These include the highways "Kalbatau–Maikapchagai," "Kurty–Konayev," "Kyzylorda–Zhezkazgan," and "Uzynagash–Otar."
At the same time, new projects for the reconstruction of republican roads with a total length of more than 1,000 km will begin. These include the construction and reconstruction of four-lane roads such as "Aktobe – Ulgaysyn," "Karaganda – Zhezkazgan," "Atyrau – Dossor," and "Bypass road of the city of Saryagash."
Special attention will be given to medium repairs on 10,000 km of roads. This year, within the framework of a large-scale project, 6,600 km will be covered, exceeding last year’s figures when repair work covered approximately 5,000 km of republican roads. The medium repair works on republican roads will continue from last year's work on sections totaling 4,000 km, including major projects like "Zhezkazgan–Petropavlovsk," "Karaganda–Ayagoz–Bugaz," "Kandyagash–Shalkar–Irgiz," and others. |
Shi Jinyu presented Junhao's Central Asian Investment Plan, which includes developing commercial real estate, the hotel business, an industrial technopark, and other key sectors. The total investment volume could reach $5 billion, and the project implementation will create several thousand jobs. |
It’s still freezing cold in Astana but warmer weather is now only 6 weeks away when it gets above 0
Construction material Demand will be picking up shortly. |
Delayed data shows December Kazakh cement production was up 8.8% on a year ago to a new December record of 626k Tonnes. It was a good rise but on a low month. January Kazakh cement output was up 5.6% to 396k Tonnes. (lowest month so not meaningful on its own but yet another rise, 3rd highest January). The market has been in growth mode since July and the rises strong enough to make one guess that pricing might be continuing to improve? These figures seem to bode well. |
if the war comes to an end that will also help STCM in a way. Its been savage for AIM equities the last 3 years. |
The new road runs past Astana. The new rail line is in the south but could still stimulate demand, sucking supply from central areas that Steppe can then infill.
Cement tends to follow the economic cycle, anyway, and that has been looking very strong. Car sales have been booming (up over 10% on last Dec, itself up almost 20%) , retail sales very strong (+16%) and the stockmarket rose about 26% last year. Things have actually started looking a little bit frothy for a couple of months and the central bank lifted rates 1% to 15.25% at the end of November. We saw record cement sales nationally in Q4. (Don't know If STCM's were.) Weather will determine Q1 but Jan and Feb are always so low that they don't matter much. March weather will start to matter (hoping for early Spring) and the recent strong trend suggests record cement output is possible. The economy seems awash with cash. Bank balance sheets were up 19.8% in December and M3 +19.3% as a strong lending run continues. Like I said, getting a bit frothy - but conditions likely to produce further improvement for STCM after finishing with an apparently strong Q4 which I hope to see confirmed in results. |
Not the same part of the country though. |
that will require plenty of cement ha |
Kazakhstan, Uzbekistan to build a highway for $172 million
The construction of the Kyzylorda-Uchkuduk highway is planned to begin in 2025. |
Kazakhstan to build 4,700 km of new national highways |
The government of Kazakhstan has announced ambitious plans for the development of its rail network over the next several years as part of the plan «For the development of railway industry in Kazakhstan until 2029». The initiative involves repair of about 11,000 kilometres of tracks and building about 5,000 kilometres of new tracks.
[...] |
A couple of largish buy trades late on. |
Spring is on the way and is starting to show, even Astana has been very mild this year so far |
the free float is very, very small, limited and tight as the proverbial DA |
In the Idle time one can contemplate the clinker stock reduction programme giving improved margins and improved cash position, and capital returns in excess of 1.5p
Wonder if the family of the Company's Chief Executive Officer, Javier del Ser Pérez has orders in at 14p ?
Or Perhaps the turn again for David Crichton-Watt ?
Either way the free-float looks tight. |
Nothing exciting or interesting now until May through September with the peak in August/early September when surge pricing kicks-in. |
It seems all of the IMF, EBRD, IFC, World Bank and ADB etc are all positive on the Kz macro-economic outlook for 2025: hxxps://www.worldbank.org/en/country/kazakhstan/publication/economic-update-winter-2023-24 |
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