In this report, we argue that in an atmosphere of rising concerns over potential global economic turmoil, credit market tightening and oil price downside risk, the rouble may weaken, obliging Russian consumers to become more price sensitive, avoid restaurants and put off purchasing electronic devices. We believe that M.Video (BUY; TP: $9.8, 56% potential upside) is well positioned to survive – and even thrive – in a crisis, while Rosinter (SELL; TP: $4.0, 11% downside) is in dire financial shape and should be avoided for now.
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