Management the Equity Capital Value of the MMK Steel Sector Company

Abstract of the thesis on the topic "Managing the cost of equity of a metallurgical sector company PJSC Magnitogorsk Iron and Steel Works" (MMK) by Yana Zhitinskaya, performed at the National Research University Higher School of Economics, Higher School of Business: Introduction and Justification: This thesis is devoted to the urgent problem of managing the cost of equity in conditions of economic instability and international sanctions. The object of the study is PJSC Magnitogorsk Iron and Steel Works (MMK), a large Russian company in the metallurgical sector. The purpose of the work is to analyze MMK's capital structure, identify deficiencies in the current management system and develop recommendations for its optimization. Research methods: To achieve this goal, financial analysis methods were used, including capital appreciation using CAPM and WACC models, risk and volatility analysis, as well as the study of alternative sources of financing. The main sections of the work include theoretical aspects of capital cost management, analysis of the current state of MMK, the impact of sanctions on the company's financial activities and the development of recommendations for managing its own capital. Main results and conclusions: Modern methods of money management: The paper examines modern research and methods of money management, including the digitalization of financial processes, the use of big data and analytics. These approaches contribute to improving the operational efficiency and sustainability of the company. MMK's capital structure: The analysis showed that in the period from 2016 to 2021, the company significantly improved its financial performance. An increase in return on equity (ROE) from 33.84% in 2016 to 60.34% in 2021, an increase in net profit and improved liquidity indicate positive dynamics. However, the company faced challenges related to high borrowing costs and changing market conditions. Impact of sanctions: Sanctions have limited MMK's access to international financial markets, which has increased the cost of borrowed capital and complicated foreign economic activity. This has affected the cost of the company's equity, requiring the development of new management strategies. Recommendations for capital optimization: The thesis offers recommendations for optimizing MMK's capital structure, including increasing the share of borrowed funds, refinancing existing debts at lower interest rates, investing in innovation and expanding production capacities. Measures to strengthen corporate governance and improve the transparency of financial statements are also proposed. Practical significance: The results of the study are of high practical importance for MMK and other companies in the metallurgical sector. The developed recommendations can be used to improve the efficiency of equity management, minimize risks and ensure sustainable financial growth in conditions of economic uncertainty. Conclusion: In conditions of economic instability and international sanctions, managing the cost of equity is becoming a key factor in maintaining financial stability and competitiveness of companies. The use of modern techniques and strategies allows you to adapt to changes in the market, optimize the capital structure and increase the investment attractiveness of the company. This thesis makes a significant contribution to the theory and practice of financial management, providing useful tools and recommendations for managing the cost of equity in modern economic conditions.