This was declared at the press conference by Askar Dostiyarov, Chairman of the Management Board of Kazyna Capital Management JSC (KCM). According to Mr. Dostiyarov, circa 60 projects obtained investment from KCM’s Funds. All of them are focused on the non-oil and gas sector, 27% in energy sector, 22% in manufacturing sector, 21% in transport and logistics, 18% in other non-oil and gas sectors and circa 5% in medicine.
“Last year KCM obtained a KZT 3 bln. net income against the targeted KZT 706 mln. although in 2016 the Company demonstrated negative results. We have achieved a fourfold increase in such profitability indicators as ROA, ROE”, said Askar Dostiyarov, Head of KCM.
In 2017 KCM decided to establish 3 new funds with total capitalization of circa $ 600 mln. One of them is a joint fund with the Development Bank of Kazakhstan with capitalization of KZT 33.5 bln. The new fund is a unique tool for Kazakhstan to combine the equity and debt financing. Currently 4 projects totaling KZT 8 bln. are under review. In total 25 promising projects are under review of the Fund.
As expected in June of this year the Agreement for establishing Eurasian Nurly (Bright) Investment Fund jointly with KCM and Chinese investors will be signed at the meeting of the Shanghai Cooperation Organization (SCO). Its capitalization will amount to $ 400 mln. 75% of investment will be applied for financing the Kazakh projects.
The transformation and re-launch of business of Baiterek Venture Fund (BVF), a subsidiary KCM resulted in its returning to over KZT300 mln. investment profit. Investment portfolio increased by 30% (KZT 10.8 bln.). Exit strategies from 4 projects were developed and are under successful implementation and as expected circa KZT 7.5 bln. of return on investment together with investment growth will be obtained. BVF developed the pipeline of 35 promising projects, including the projects under approved Regional Development Program.
According to the Head of KCM, Kazakhstan needs alternative sources of financing for domestic companies. Private equity funds may become such source since they have significant amounts available for investment.
“With proper development of the private equity infrastructure in Kazakhstan, including the development of regulatory framework, expansion of financial instruments for financing and exit from investment, other initiatives aimed at increasing the attractiveness of investment in the economy as well as enhancement of professional expertise and generation of a huge number of private equity market participants, we will be able not only to ensure a stable inflow of investment but also create the basis for development of the private equity industry in the region” summarized Askar Dostiyarov.