Russian Dividends under sanctions: Not that bad

Source: Russia’s Federal Statistics Service, ITI CapitalUnsurprisingly, prior to the conflict in Ukraine, we had assumed that total dividends for 2021 would exceed ₽5.1 trln, or $70 bln, compared to actual ₽2.9 trln now (almost half the potential), of which 44% are Gazprom’s ₽1.3 trln in dividends, certainly the all-time high.Exporters' share of total payments for 2021 was 94%, compared with the expected 80% and the 10-year average of 70-75%.

In fact, only slightly more than a third (30) of over 80 most deep-pocketed companies will pay dividends for 2021. This is an all-time low, which is not even comparable with the pandemic-stricken 2020.Back then, more than 60 companies paid dividends on the back of a strong recovery in the commodity and capital markets.If it weren’t for the conflict in Ukraine, dividend could have been a powerful growth driver for Russian companies and the market as a whole on the way to new records.See: Russia record dividends for 3Q21 and estimates for 2021 22.12.2021 (iticapital.ru) *E - estimate as of 31.12.21, before the conflict in UkraineSource: Company data, ITI CapitalWith Gazprom's large share in the Russian dividends payments and a high dividend yield of 19% for 2021, the weighted average yield for 2021 could be 15.2%, compared with an average yield of 9.6% (before the conflict), 6% for 2020 and 9% for the pre-pandemic 2019.