Ministry of Industry To Attract Funds For Rostec’s Project

Ministry of Industry To Attract Funds For Rostec’s Project

Up to 10 billion of investments will be attracted for Rostec’s light aircraft project. By the end of the year Ministry of Industry will agree with the Ministry of Economic Development and the Ministry of Finance on attraction of the National Welfare Fund’s financial resources. This was told by the Deputy Minister of Industry and Trade Yury Slyusar.

The project for production of light aircraft for 9-19 persons is implemented by Rostec with Austrian Diamond Aircraft Industries. This year they are going to complete research and development under the project and proceed to the experimental design stage. The aircraft will be produced in 2017-2018.

Rostec estimates that the project costs will be approximately  9.4 billion rubles, including own funds of  383 million rubles.

“We already have 2 bln and need to attract about 8 bln. The project involves own Rostec funds and project financing. Here we also expect National Welfare Fund’s financial resources,” the Deputy Minister of Industry and Trade Yury Slyusar said according to ITAR-TASS.

In 2013-2016 Rostec Corporation expects to use leveraged financing, including National Welfare Fund’s resources. The funds will be no more than 5 billion rubles and will be used for research and development under the project, transfer of technologies, creation of a new plant and certification. About 30% of investments, or about 3 billion rubles, will be attracted from the federal budget. 

These funds will be used for completion of the certification, acquisition of a part of the required equipment, creation of the maintenance and repair system in 2016-2017. In 2016-2018 additional  900 million rubles will be needed to achieve the design capacity.
By 2030 Rostec is going to supply approximately 800 aircraft. Preliminary price of the basic version of a 19-seat aircraft is 120 million rubles, 9-seat version – 80 million rubles.

Total sales under the project by 2025 (VAT excluded) will be 51.4 billion rubles. Net accumulated profit by 2025 will be 16.235 billion rubles. Return on sales will be 32%. According to Rostec, the discounted payback period for the project will be 10.39 years. Net present value will be approximately  1.248 billion rubles.