Tatneft 1Q21 IFRS review: Key P&L numbers met market expectations

Tatneft IFRS review: EBITDA up 33% QoQ, driven by higher netbacks
Tatneft on Friday published IFRS results for 1Q21 and held a conference call. The numbers lived up to market expectations based on the improved commodity environment in 1Q21, and appear neutral for Tatneft shares. Even without tax benefits since 2021, the company expectedly delivered a higher EBITDA margin.
According to the company’s dividend policy, 1Q21 will contribute at least RUB 9.4 (DY of ~2%) to the 2021 DPS. Payment of 100% of FCF as dividends could improve investment sentiment toward the stock, yet the next announcement of dividends will take place only after the publication of 2Q21 results. We reiterate our OVERWEIGHT recommendation on Tatneft shares and see decent upside potential to their fundamental value.