Marking a year since the first coronavirus (COVID-19) lockdown in Russia, The Bell on March 26 reviewed the main beneficiaries and the main losers from the turbulent pandemic year of 2020.

Evotor data showed that the turnover of Russian SMEs already in September 2020 beat the pre-lockdown numbers by 2.5%, but the number of companies was down by 8%, indicating that certain segments saw a purge of the weakest players.

Sber.Index data also show that the spending of Russians returned to its pre-lockdown level of March 2020 (up by 2.4%), which is also supported by the latest macro data indicating speedy demand recovery. However, given the 5.4% inflation, the real purchasing power declined.

Offline and online retail main winners
E-commerce is seen as the main beneficiary of the COVID-19 year, with the e-commerce market up by 34% in 2020 at RUB2.7 trillion ($35.6bn), with The Bell reminding that Russian e-commerce major Ozon, which still has to break even, managed to IPO on Nasdaq with a valuation of over $10bn.

While the fashion retail market was down by 20% in 2020, those companies that managed to quickly reorient to online sales maintained stable sales growth.

As reported by bne IntelliNews, although the food retail market expanded only by 1.7% in 2020, analysts argued that coronavirus (COVID-19) related tailwinds and altered consumption patterns created an extremely benevolent environment for large chains such as X5 Group and Magnit.

X5 in particular had a strong head start on digital innovation and used its advantage to emerge as the largest e-grocer in 2020. The group is determined to IPO its e-grocery and express delivery assets in the medium term.

Services suffer the most 
As most of the service providers were unable to shift their services online, this sector was hurt the most by the lockdowns, especially in the Moscow Region, which usually fares better than the rest of the country, analysts surveyed by The Bell note.

Catering saw 21% drop in turnover in 2020, with market participants estimating some market segments declined by 50%. In Moscow, the catering segment was hit by 20-60% cuts in revenues and saw the number of closures rise by 35% to about 200. It is estimated that overall about 20% of players in the catering business had to close in Russia.

The oversaturated beauty segment was also hit hard, still seeing revenues of about 33% lower than a year before. However, some of the beauty salons, barber shops and other beauty services reportedly continued to provide services illegally. The fitness club segment is still at 10-15% below its pre-COVID capacity.

Tourism shocked as borders closed
Sber.Index data shows that spending on air travel is 69% below the levels of March 2020. Sales across the tourism sector and organised tours went down by about 70%, with visibility of a recovery remaining very low.

As reported by bne IntelliNews, the shift of the usual spending for travelling abroad is seen as one of the factors supporting domestic demand. Russian air travel traffic has been one of the fastest to recover globally due to the strong performance of the domestic market. 

Income growth and investment still questioned
As reported by bne IntelliNews, Russians' real disposable incomes have fallen to an eight-year low as a result of the coronacrisis, declining by 3.5% in 2020.

Analysts surveyed by The Bell also remind that over the past seven years incomes decreased by 10%, while the number of those below the poverty line increased by over 0.4mn people despite state social support. Income declines are shaping consumption choices and patterns, with focus on savings, sales and special offers. 

At the same time, entrepreneurs and business owners after surviving the COVID-19 pandemic might be further discouraged from maintaining stable capital investment. Shorter-term business models with a high degree of flexibility and liquid cash are likely to be favoured.

Another post-COVID trend suggested by The Bell is shifting into the grey sector of the economy. After the high number of insolvencies, SMEs could tend to scatter their assets under multiple entities to avoid bankruptcy risks and lower the tax burden.