Maxim Manturov, Head of Investment Research at Freedom Finance Europe, explores five of Kazakhstan’s leading and strategically important stocks to invest in.
Kazakhstan has seen significant growth in recent years. Largely from market reforms and owning an abundance of natural resources like gas, oil, and uranium, Kazakhstan is becoming a powerhouse in Central Asia. The Kazakhstan Stock Exchange (KASE) is home to several of the country’s leading and most systemically important companies, providing investors with an abundance of promising opportunities.
Kaspi.kz (KSPI) is a fintech company providing a range of services. These services include banking, insurance, payments, and predominantly serve customers in Kazakhstan. Kaspi.kz is well positioned to capture a share of its market as the economy develops further and people gain more access to financial services. At the moment, virtually every Kazakhstani person uses the Kaspi app daily for payments, transfers, and purchases. Kaspi.kz has an established position in the market, a strong brand, and an integrated business model which is reflected in its stable revenue and profitability growth in recent years.
Halyk Bank (HSBK) is one of Kazakhstan’s largest banks and often called “too big to fail”. It offers a wide range of retail and corporate banking services and hasestablished market position, and a strong brand. Halyk Bank’s customer base is large and diverse, helping to mitigate the risks associated with each segment.
Kcell (KCEL) is one of the largest telecommunications companies providing mobile and fixed-line services in Kazakhstan. The company has an established position in its field as well as a wide range of products and services which further strengthen its already strong brand.
The company also has a large and diverse customer base, which helps mitigate the risks associated with each segment. There is a large and growing market opportunity in the telecommunications sector in Kazakhstan. The company also has a stable financial performance track record. As more people gain access to mobile and fixed-line services, Kcell is well-positioned for further growth.
Kazatomprom (KAP) is a Kazakhstani nuclear company specialising in the production of uranium and nuclear fuel. It manifests itself globally with priority access to one of the largest resource bases. Kazatomprom mines uranium only in Kazakhstan and has the largest uranium reserve base in the industry with 295,000 tonnes.
The company’s uranium deposits are suitable for cost-effective and least environmentally damaging ISL mining, which, combined with the long life of its mining assets, allows Kazatomprom to remain among the world’s leading producers with the lowest cost of uranium production. Kazatomprom is well positioned to benefit from the growing global demand for nuclear power, with more countries switching to low-carbon energy sources. Kazatomprom’s large uranium reserves and vertical integration, allow it to control the entire nuclear fuel production process from mining to enrichment and fuel fabrication.
KazMunayGas (KMGZ) is Kazakhstan’s largest oil and gas company. KMG manages assets across the entire production cycle, from hydrocarbon exploration and production to transportation, processing, and services. As demand for oil and gas continues to rise, KMG is well placed to capitalise on it.
The oil and gas industry is one of the most important industries for the economy in Kazakhstan, which is among the twenty largest oil-producing countries in the world, and JSC NC KazMunayGas ranks first in Kazakhstan in terms of oil production. Over the next ten years, its growth will be driven by an increased resource base, efficiency of current operations, lengthening of the value chain, implementation of modern technologies,and a reduced carbon footprint.