Leading Russian producer of high-tech railway cars United Wagon Company (UWC) has successfully closed its IPO on the Moscow Exchange, the company said in a press release on April 30.

UWC sold 12.22% of its shares under the public offering for a total of RUB 9.028bn ($180mn) at a price of RUB700 per share, exactly in the middle of the RUB650-RUB700 per share price range set last week. Public trading of UWC shares on the Moscow Exchange began immediately. 

The stock flotation gives UWC a market capitalisation of RUB73.9bn ($1.5bn). More than 50 investors participated in the offering, the company reports, of which over a third (38.3%) were foreign investors.

"Demand from institutional investors covered 81.6% of the offering, including pension funds (11.1%), while retail and high net worth investors acquired 18.4% of placed shares," UWC said in a statement. "The top managers of the company participated in the offering, as previously announced."

This was the first Russian company IPO since the retail chain Lenta raised $952mn on the London Stock Exchange in February 2014. The UWC issue was organised by VTB Capital and mid-tier investment bank Otkritie Financial Group, which were joint lead managers and joint bookrunners of the offering.

"Many investors have shown interest in the investment case of both RPC UWC and the wider rail market, and we are delighted with the results of the IPO," said the company's CEO Roman Savushkin said. "We were able to build a quality and diversified order book, consisting of both institutional and retail investors. Even though the Offering was focused on the domestic market, foreign investors made up over a third of demand. We welcome our new shareholders and we remain focused on developing the Company to enhance the value of our business."

The IPO result underpins the recent improvement in investors attitude to Russian stocks on the back of a milder than expected recession and the extremely low price of Russian shares.

Russian ETFs have been rallying strongly this year, making the Russian equity market one of the best performing in the world. Russian dedicated investment funds focused on Russia saw their largest weekly influx of cash since September last week, showing that international investors are now returning to Russia after last year’s torrential capital outflows, Kommersant daily reported last week. The leading RTS index soared 31% year-to-date as of April 30.

Funds concentrating on Russia gained $182mn in investment in the week ending April 22, more than three times the amount attracted the week before, the Moscow Times reported, citing data from Emerging Portfolio Fund Research (EPFR). Russia-focused funds have gained $362mn in investment since the start of the year.

Russia is currently bucking the trend since emerging markets as a whole have seen outflows in the first quarter after rallying strongly in 2014. Emerging markets funds lost a total of $4.1 billion last week, or three times as much as the week prior, Kommersant reports, the biggest loss for emerging markets funds since mid-December, when their weekly outflow hit $6.8bn, according to EPFR.