The success of Hermitage Capital Management stems from our firm commitment to the values of ethics and integrity, consistent investment strategy, active shareholder stance and rigorous research.

Ethics
At the heart of Hermitage Capital Management strategy is the resolute adherence to the values of ethics and integrity that has won us the credibility among the international and local investment community, issuers, government agencies and international organizations.

Investment Strategy
Our investment strategy is based on selecting investments and composing a portfolio to achieve superior capital gains for our clients by taking significant positions in companies which are undervalued to their peers both in Russia and worldwide. Very often, these companies have attractive assets (oil, gas and other natural resources) but suffer from poor corporate governance practices.

Shareholder Activism
As part of our investment strategy, Hermitage Capital Management aims to realize an appreciation of undervalued Russian companies through corporate shareholder activism (often in cooperation with other investors) or through outside intervention triggered by revelations of corporate malfeasance. In some cases, instead of waiting for the company's management to change and stop their value-destroying activities, Hermitage launches a campaign to unlock the hidden value of its investments and works with the management and government bodies to improve transparency and corporate governance practices at Russian companies.

Rigorous Research
The upside opportunities of Russian equities are assessed through rigorous primary research. Our research enables us to identify and monitor most attractive stocks that have solid fundamentals, cheap valuations and "hidden values" overlooked by the market.

Prior to making any investment decision, qualitative and quantitative analysis is conducted. The objective of such research is to uncover hidden inefficiencies caused by corporate management's actions and formulate a strategy which will eliminate value destruction by the company's management.

Our research is based on the detailed understanding of the business and market environment. The proprietary research into Russian stocks includes evaluation of, among other things, the following parameters:

• The true nature of the company's financial standing beyond published financials;
• Actual ownership structure of the company's stocks;
• Past, current and future intentions and actions of the company's management;
• Likely government policies regarding the company and its management;
• Rights of minority shareholders under the company charter and the Russian law;
• Potential changes in the quality of these rights.

The dedicated investment team at Hermitage Capital Management has an unparalleled experience in addressing these challenging issues to enable a sound investment decision.