Dear investors,

Thank you for your interest in Etalon Group! With a successful track record that spans over 30 years, Etalon Group is one of Russia’s leading development and construction companies. The Company today focusses on residential development in the mid-market segment in Russia’s two most lucrative markets of Moscow and St Petersburg, and we have delivered 7 million sqm since our inception.

Chairman of the Board of Directors

This is only the beginning – I am inspired by the potential that Etalon Group holds, and as Chairman of the Board of Directors I am genuinely excited about this Company’s future. At the Board of Directors we have set ambitious goals for the Company. We expect Etalon Group’s management to succeed at becoming Russia’s leading residential developer.


Etalon Group has delivered consistent sales growth since its IPO, and I believe that investors have every reason to share my optimism about the future.

Potential for growth

Russia’s residential real estate market holds significant growth catalysts, and Etalon Group is one of the best-positioned to capitalise on the opportunities this presents. Both the Moscow and St Petersburg markets are still largely unsaturated, with living space per capita well below the average for other European countries. Given this potential, and Etalon Group’s success in these markets, the Company plans to maintain its strategic focus on the mid-market segment cementing its dominant position, while expanding its presence in other segments.

Creating value for stakeholders

In addition to its focus on these attractive market segments, the Board supports Etalon Group’s aim to maintain its sustainable financial position. This is especially important as new market regulation on development project financing comes into force. The Company has already shown its ability to achieve this by effectively managing the construction cycle, and we have confidence in management’s ability to effectively adapt as new regulations change the way residential developers have traditionally operated.

Another important area of focus is continued improvements to the efficiency of Etalon Group’s development business, while also seeking to monetise related business units such as the maintenance business, where Etalon Group intends to provide additional services for people who live in Etalon Group houses.

Finally, Etalon Group will create value for customers and other stakeholders by environmentally-friendly living spaces, with an increasing focus on areas like energy efficiency and water conservation, safer building materials and improved green spaces at developments.

Acquisition of Leader-Invest

I believe that our strategy will create significant value for our investors and other stakeholders of Etalon Group.

The Company has already taken an important step towards accomplishing them with the acquisition and consolidation of 100% in Moscow-based developer Leader-Invest in 2019. This transaction has transformed Etalon into one of the top developers in Russia’s capital city, and significantly expanded its presence in the business class segment. Etalon Group expects value-creating synergies from this transaction. Some of the key areas we expect to achieve this are in implementation of best practices from both companies, operational improvements as we transition to Etalon Group’s own construction contractors and more effective sales by leveraging Etalon Group’s nationwide sales network.

Also in February 2019, Sistema joined Etalon Group’s shareholder structure following a transaction to acquire a 25% stake from the family of Etalon Group founder Viacheslav Zarenkov. In addition to Sistema’s commitment to support Etalon Group’s strategic development, the two companies have signed a relationship agreement under which they commit, inter alia, to uphold good governance and business practices, to maintain Etalon Group as a publicly-listed company, and to commit to Etalon Group’s dividend policy.


Etalon Group’s sustainability efforts are also notable, and this is an important area for the Board of Directors.

Already the Company is taking steps to reduce the impact of its business activities by increasing recycling of building materials, as well as reducing fuel, petrol, diesel and electricity consumption at construction sites. Safety is a top priority across the business, with our cutting-edge, in-house Safety Index used to identify risks and monitor workplace safety at our sites. With reporting systems in place to monitor our performance in these areas, Etalon Group will develop targets and report its progress against them. At the same time, we aim to give our consumers more environmentally-friendly living spaces by introducing technologies that improve efficiency and enable residents reduce consumption, make it easier to recycle waste, and enjoy greener territories around their buildings.


Since joining the Etalon Group Board of Directors as a Chairman, I am happy to say that this is company that is in excellent shape to deliver significant, sustainable value in the years ahead.

Etalon Group’s highly-qualified and motivated management team has its eyes set on achieving the ambitious goals that the Board of Directors has set for them. The Company’s well as established governance, transparency and disclosure policies will continue to develop with the Board’s guidance, as we are committed to Etalon Group maintaining its status as a public company.

Etalon Group enjoys a strong reputation among its customers, shareholders and other stakeholders. This is a key competitive advantage for any residential developer, and once we integrate Leader-Invest and expand into other segments, a wider audience of consumers will come to know Etalon Group as a trusted partner that provides high-quality homes in Russia’s two capitals.

Thank you again for your interest in Etalon Group!