CAPITAL STRUCTURE ADJUSTMENT OF RUSSIAN FIRMS UNDER ECONOMIC SANCTIONS

Abstract

In the context of large-scale sanctions imposed on the Russian Federation since 2022, the capital structure of Russian companies has undergone significant changes. The purpose of this study is to analyze the transformation of the capital structure of large public issuers in the context of external economic isolation, rising borrowing costs and limited access to international sources of financing. The paper uses case analysis, retrospective analysis of financial statements, as well as a comparative interpretation of debt burden and profitability ratios. The empirical base of the study includes data from companies from various industries (X5, LUKOIL, Yandex, SPB Exchange, VkusVill) for the period 2021–2024. It is shown that the main areas of adaptation were debt de-dollarization, an increase in the share of domestic ruble financing, an increase in equity capital through retained earnings and share buybacks, as well as a reduction in external debt. The companies' strategies demonstrate compliance with the compromise theory of capital structure and the hierarchy of preferences model. The growing role of state banks in lending and increasing dependence on domestic financial policy are noted. The practical significance of the work lies in the possibility of applying the findings to develop corporate financial strategies in conditions of limited access to external capital markets.