Alibaba (BABA US), the Chinese internet giant is close to finalizing a joint venture with one of the two big internet companies in Russia Mail.Ru (MAIL.LI), according to Financial Times. This would be part of the China’s vision of a “Digital Silk Road”.

FT notes:

Alibaba has long seen Russia as a key growth market, where major western online retail giants have little or no presence. Although ecommerce lags behind the rest of Europe, hampered by the preponderance of cash transactions, there is great potential. More than half the 140m population use the internet daily”

Mail.Ru (MAIL LI) is one of the two main Internet companies in Russia. The other being Yandex (YNDX US). Mail.Ru’s main asset is the popular social networking VK, whilst for Yandex (YNDX US), it is Russian based search engine and car-riding JV with Uber called “Taxi”.

Russian Internet market, has some similar characteristic as the Chinese market. There are few western Internet giants extensively active within the country, which has created the opportunity for domestic companies to grow. This is fairly similar to China, in which giants like Tencent (TECHY US), Alibaba (BABA US), (JD US), Baidu (BIDU US) have been able to grow strong and become enormous companies.

Both Mail.Ru (MAIL LI) and Yandex (YNDX US) are listed on western exchanges.  Both share prices have taken substantial hits with the recent emerging market turmoil and talk of Russian sanctions, as can be seen from the share price charts below. Trading in Yandex (orange) offers good liquidity but Mail.Ru (white) is rather illiquid, so bear in mind that aspect. Below is in one year chart in percentage terms.

Source: Bloomberg

Considering the large population, internet penetration and computer literacy in Russia, these companies could be interesting stocks to follow as potential long plays could be setting up soon.

Investors that feel they “missed the train” on all the high-flying Chinese internet names, have now the opportunity to have a further look at another region that could potentially be high growth.