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How will change market price of SOCAR bonds - ANALYTICS

How will change market price of SOCAR bonds - ANALYTICS
Analysts: 'Bonds become more stable financial instrument as they are in US-dollar'

Baku. 19 October. REPORT.AZ/ After completion of initialplacement of SOCAR bonds in the Azerbaijani market on October 10, turnover of the bonds in the secondary market was launched yesterday, on October 18.

Report informs, nominal of the bonds planned at 1 000 USD, turnover period 5 years, annual yield 5%, also, interest payment every 3 months. Namely, on January 10, 2017, bondholder investors will be able to get 3-month interests from PSG Capital investment company, which is underwriter and market-maker of the issue. It will be equal to 12.5 USD for each bond, annual revenue to 50 USD.

SOCAR bonds price in the secondary market will change according to the period of interest revenue. Thus, SOCAR bonds will provide daily 50/365, namely about 0.137 USD interest income. It means 0.96 USD per week. Of course, bonds are formed by various factors developed financial markets. However, as Azerbaijani financial market is in the stage of formation, Analytical Group of Report News Agency considers that the bonds price will change according to the period: "It should be noted that SOCAR bonds become more stable financial instrument due to being in US-dollars. If the bonds were in manat, the Central Bank's discount rate and changes in AZN/USD exchange rate would have an impact on the bonds price.

"In other words, price of the bonds will be 1 001 USD at the end of the first week of turnover, 1 005 USD 5 weeks later, 1 012,5 USD at the end of 3 months. The process will be repeated again after receiving interests', the analysts said. 

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