As any shrewd investor points out, lowly-priced equities are only a bargain screaming out to be bought if the expected corporate earnings are stronger than the low share price suggests. And that insight readily applies to Russia, says private bank Lombard Odier Darier Hentsch.

At present, while equities of companies such as oil firms have fallen sharply this year amid the financial turmoil, equities are by no means a strong bargain, according to Pascal Menges, an equity analyst at the Swiss private bank.

"Russian oil companies are cheap for good reason. Per barrel, Russian oil companies generate half the cash flow of their international peers.”

Russian stocks have been hammered as investors’ appetite for risk exposure has dried up amid the credit crunch, and also because of concerns by non-Russian investors following Russia’s military conflict with Georgia. The Morgan Stanley Capital International Russia index of stocks is down by almost 56 per cent since the start of the year in dollar terms.

As a result, according to equity research from US bank Citi, for example, Russian stocks are priced, on a forecast earnings basis, on a price/earnings ratio of 6.9 times earnings, which is far cheaper than say, Czech Republic, at 12.6 times. Russian stocks certainly look cheap, but Mr Menges said there are reasons why investors may still be wary of entering the market.

However, although Mr Menges has concerns about the earnings prospects of oil firms, he is more bullish about the important Russian gas production sector.

“Globally, demand for gas is outpacing oil, and Russia, which holds the world's largest natural gas reserves, stands to benefit. Although the price of gas currently lags that of oil, we expect rising liquefied natural gas volumes to create a more liquid market and enable a re-rating of gas versus oil. Russian gas companies like Gazprom will also materially benefit from the expected rise in domestic gas prices in Russia,” he added.

In recent weeks, investors have pulled billions of dollars from Russian investments on the largest scale since the 1998 Russian debt default, according to central bank data.