What happened

Investors in Russian e-commerce company and 2020 initial public offering (IPO) Ozon Holdings (OZON) are discovering the geopolitical risks today.

Less than 24 hours after President Vladimir Putin of Russia declared that he is recognizing two regions of Ukraine as independent states -- and sending in armored columns of tanks to enforce their "independence" -- investors are selling off Ozon stock, to the tune of 6.4% as of 3:25 p.m. ET on Tuesday.

So what

For investors who unfortunately entrusted the safety of their retirement nest eggs to the tender mercies of Putin, this is a situation that's likely to get even worse, as the Russian president's actions threaten to rain down sanctions upon any company tied too closely to Russia.

Already, members of the United Nations Security Council have denounced Russia's actions, and the United Kingdom, the United States, and the European Union have all announced new economic sanctions against Russia.

In particular, this morning Germany announced that it is suspending approval of the Russian-built Nord Stream 2 natural gas pipeline to Europe. And President Joe Biden on Tuesday characterized its economic sanctions as being just the "first tranche" of America's response, implying even more economic sanctions are on the way.    

Chess pieces and Russian US and EU flags surround a map of Ukraine.

Image source: Getty Images.

Now what

Potentially, these sanctions could include cutting off Russia and its companies from the international SWIFT banking system, which could hurt companies like Ozon (incorporated in Cyprus but doing 100% of its business in Russia) particularly hard.

In addition, as a U.S.-listed Russian stock, Ozon could be at particular risk should the U.S. government order Russian stocks delisted from U.S. exchanges -- a penalty that's been test-run with some success in punishing Chinese human rights, intellectual property, and other violations.  

With its stock already down 37% from its IPO price, Ozon already looks like a broken IPO. Thanks to Russia's president, it's looking like things are going to get even worse for Ozon shareholders.