On September 13, Rosneft plans to collect investor applications for exchange-traded bonds of the 002P-12 series with a volume of at least 10 billion yuan and a two-year maturity. The full ten-year circulation period is set, and the coupon rate will be announced later, according to preliminary issue parameters reported by Vedomosti.
Even from these initial figures, observers see Rosneft poised to significantly expand the Russian yuan bond market. This view comes from the first vice-president and head of Gazprombank’s Capital Markets Bloc, who notes that the large size of the offering signals a potential market shift.
The expert adds that Rosneft’s scale and solid credit rating are likely to attract strong demand not only from institutional investors but also from retail buyers. The anticipated high liquidity of Rosneft’s yuan bonds could make the issue especially attractive on the stock market, aligning with broader trends toward yuan-denominated instruments in Russia.
Analysts suggest that launching another major issuer with yuan bonds and robust financial backing, backed by a diverse portfolio of projects like Rosneft, would be a constructive signal for the overall Russian securities market. Gazprombank projects that Rosneft’s liquidity in yuan will broaden the spectrum of available investment tools and support ongoing market development.
Sergey Suverov, investment strategist at Arikapital Management Company, reminds readers that yuan-denominated bonds are still relatively scarce in Russia. He notes that in August, Rusal and Polyus issued 4 billion and 4.6 billion yuan-denominated bonds, with coupon rates of 3.9 percent and 3.8 percent respectively. Metalloinvest also announced plans to place up to 2 billion yuan-denominated bonds in the domestic market, offering a coupon rate of up to 3.5 percent for a two-year issue and up to 4 percent for a five-year issue.
Suverov emphasizes that Rosneft’s significantly larger operations and consistently high credit ratings should translate into heightened interest in the company’s bond issuance.
The expert highlights that the entrance of large players into the Russian bond market to place yuan-denominated securities is a clearly positive signal for the market as a whole.
Alexander Frolov, Deputy Director General of the National Energy Institute, characterizes Rosneft’s move to finance activities in Chinese yuan as a logical step for a company that has become a key supplier of oil to China.
Rosneft has historically provided around seven percent of China’s total annual crude needs up to this year, with long-term contracts in place with CNPC.
According to Rosneft’s reports, the share of revenue from oil and oil products sales to the Asian region exceeded 27 percent in 2021, with most deliveries coming from China.
The expert asserts that the share of Chinese sales has already risen and is expected to climb further as deliveries continue to shift toward the Asian market this year.
Moreover, given the steps already taken by Russian and Chinese authorities to move mutual agreements toward domestic currencies, there is confidence that Rosneft will receive a yuan-based revenue stream to meet the bond obligations. This development effectively mitigates currency risk for the company, according to the deputy director general of the National Energy Institute.