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Companies

Russia's largest mobile phone operator MTS has been ranked among the top 100 most powerful brands worldwide, according to the third annual BrandZ ranking.

REBECCAH BILLING

THE MOSCOW NEWS

MTS enters the chart in 89th place with a brand value of around $8 bn, making it the first and only Russian brand to make the top 100. The ranking by global market research firm Millward Brown identifies the world's most pow- erful brands as measured by their dollar value based on market data from Datamonitor as well as interviews with over a million consumers around the world. The top spot in this year's rank- ing went to Google for the sec- ond year running, with a brand value of $86 bn, followed by General Electric ($71 bn), Mi- crosoft ($71 bn) and Coca-Cola ($58 bn). Two notable absentees from the top ten were Citi and

RUSSIA INDIA BUSINESS REPORT

IN ASSOCIATION WITH ROSSIYSKAYA GAZETA, RUSSIA

THE ECONOMIC TIMES WEDNESDAY_MAY 12_2010

BOOKMARKS

www.rosatom.ru/en The State Atomic Energy Corpora- tion "Rosatom" www.tvel.ru/en TVEL Fuel Company, one of the world leading manufacturers of nuclear fuel

Ranking Brands are becoming more valuable and powerful in driving business growth worldwide

Branding across borders

nies to make the top ten with a brand value of over $57 bn. Although MTS was the only Russian brand to make the top 100, several other Russian brands came close including the beer brand Baltika, which made the global beer top 20, claiming the 15th spot with a value of $1.086 bn: "Baltika is a very strong brand. It achieved one of the highest scores in brand contribution, which is the measurement of brand strength; since we measured this last year, its value has risen 20 pc," Joanna Seddon, CEO of Millward Brown Optimor said.

Strong brands generate superior returns and protect business- es from risk.

Wal-Mart; both companies claimed strong top ten posi- tions in previous years but in 2008, ranking slipped to posi- tions 15 and 13 respectively. The study found that domestic brands from emerging econo- mies are gaining momentum.

Chinese brands performed par- ticularly strongly; the value of the four Chinese brands that made this year's BrandZ Top 100 have increased by 51 pc since last year's ranking to $124 bn. China Mobile was one of only two non-US based compa-

Another Russian brand, which missed the final cut by a whis- ker, was MTS rival operator Beeline: "According to our esti- mates, Beeline just missed it; we estimated their brand value at about $6.6 bn which is just under the ranking," Seddon ex- plained. This indicates a reversal of for- tunes since BusinessWeek Rus- sia published the first Russian brand ranking in October 2005,

which put Beeline firmly in first place with a brand value of $5 bn and MTS trailing in second with a value of $4.7 bn. Although it did not make the grade this year, Russia's largest oil business group, Lukoil, is predicted to feature in future rankings. The brand was ranked 8th in the motor oil category with a value of $851 mn. Overall, this year's ranking in- dicates that brands are becom- ing more valuable and power- ful in driving business growth. Companies that own brands in the BrandZ Top 100 have sig- nificantly outperformed the stock market when compared to the S&P 500. The combined value of all brands increased by 21 pc from $1.6 trln in 2007 to $1.94 trln in 2008, more than double the increase experi- enced the previous year. "This year's brand ranking demon- strates the importance of in- vesting in brands, especially in times of market turmoil. Strong brands generate superior re- turns and protect businesses from risk," Seddon concludes.

NEWS IN BRIEF

The number of poor declines

In 2009, the number of Rus- sia’s poor had declined in com- parison to the previous year by 400,000 people, or from 13.4 to 13.1 pc, reported Rus- sia’s Federal State Statistics Service. Today, 18.5 mn people are living below the poverty line, defined as the minimum living wage of an average of 5,153 rubles ($178) per annum. This is the lowest level in Rus- sia since 1992. Meanwhile, Igor Polyakov, an economist for the Center of Macroeco- nomic Analysis, says that Rosstat has painted an overly positive picture, his estimates of the country’s poverty level exceed the official statistics by 5-6 percentage points. RIR

EPSILON

Energy The corporation can provide state-of-the-art technologies for a fuel fabrication enterprise in India

TVEL fuel company on a leadership path

JSC TVEL plans to become a global nuclear technology leader and intends to actively develop cooperation with Indian partners.

JULIA IVANOVA

RIR

Attitudes towards nuclear power have changed in recent years as concerns over energy security and global warming mount. Concerns about the safety of nuclear power have been overtaken by the worries that carbon emissions will cause irreversible environmen- tal damage on a global scale. Add to that, the fact that ex- perts agree the world will run out of fossil fuels in the next few decades and there is little choice other than nuclear power to replace them. Russia is already one of the world’s leaders in the peaceful use of atomic power and in the coming years, it intends to devel- op the national nuclear energy sector, led by the state agency Rosatom. Plans are already on the table to build 26 new nuclear power stations in Russia in the medium term and more will fol- low. At the same time, Rosatom has been actively offering Rus- sian technology to its partners

TVEL enterprises have capaci- ties to operate the Russian- design NPPs that are currently under construction in India

abroad that has led to a string of contracts last year. As part of Rosatom’s nuclear sector reform to improve both ef- ficiency and safety, the govern- ment has decided to establish a Russian nuclear fuel company based on the joint stock compa- ny TVEL that will include enter- prises manufacturing gas centri- fuges, separation and sublimation complexes and fuel fabrication plants. TVEL remains state-owned, but since it is in the front line of the Kremlin’s efforts to take Russia’s

energy expertise beyond simply digging for oil and gas, the com- pany has been working hard to reduce costs and increase effi- ciency of the fuel fabrication en- terprise through investment and development. Today, the compa- ny TVEL has already achieved a high level of production cost-ef- ficiency and world class levels of profitability. Streamlining costs and raising efficiency have been core parts of the strategy to develop the com- pany’s presence in the interna- tional market. One of the key de-

velopments has been a programme to improve the ef- fectiveness of the fuel for Rus- sian-designed NPP reactors and increase their power output. The success of the investment and re- forms has left the company with strong competitive advantages that has allowed TVEL to win all the open tenders it has competed for so far. The company has also won long- term contracts to supply fuel to nuclear power plants in Slova- kia, the Czech Republic and Fin- land. In addition, the company

supplies nuclear fuel to many Western-design reactors as a part of its cooperation with the leading French energy conglom- erate AREVA. Now, TVEL is getting ready to scale up again as a part of its role as the national nuclear fuel com- pany. The goal is to significantly increase the company’s presence in global nuclear fuel market from the current 17 pc to 25pc by 2025. In addition, TVEL intends to increase the number of cus- tomers on the uranium enrich- ment market. The Indian market is one of the company’s priorities and Russia already has partnered with India on nuclear programme for sev- eral decades. One of the first agreements concluded by India after the waive of the export- control restrictions in atomic en- ergy by the Group of Nuclear Suppliers was the agreement concluded in 2009 with the TVEL on supplies of 2000 tonnes of uranium dioxide fuel pellets for the Rajasthan NPP. More- over, a single contract for the Tarapur NPP on the supply of pellets with the 235 uranium en- richment upto 2.66 pc amount- ing 58 tonnes was concluded the same year. In March 2010, Russian Prime

Minister Vladimir Putin visited India where the principle agree- ments on the cooperation in atomic energy were achieved, in particular a roadmap for the construction of more than 12 nu- clear power units based on the Russian technologies. TVEL en- terprises have sufficient capaci- ties to operate the Russian-de- sign NPPs during their life cycle that are currently under con- struction in India. One of the main objects of the bi- leteral cooperation in nuclear energy field today is the Ku- dankulam NPP with two VVER- 1000 Units of the total capacity amounting to 2000 MW. In 2008- 2009, the company delivered the initial fuel batch and the first re- loading nuclear fuel batch to the NPP. Later, the second, third. fourth and fifth batches were made for NPP Units 1 and 2. In 2009, TVEL developed the tech- nical and economic offer for the delivery of the new fuel type based on TVS-2M. The improved assemblies give opportunities to use prolonged fuel cycles, to in- crease the unit capacity upto 104 pc and to generate additional upto 500 thousand MWh of elec- tricity per year. India and Russia have also ex- plored the possibility to set up a fuel fabrication enterprise on the territory of India if cost-effi- cient. In case India considers the construction of such enterprise worthwhile TVEL is prepared to provide state-of-the-art tech- nologies and equipment.

OLEG KHARSEEV_KOMMERSANT

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