guru267 wrote:the deal wrote:I had a Strong Buy recommendation but eishh i have to downgrade my recommendation to a HOLD/BUY...reason being management expect profits to grow by 5% y-o-y between now and 2014, with no power hike in 2011 i dont see where the growth trajectory will come from...i have a target price of 27 bob with a 1 year horizon on KPLC equating to a PE of 11.7 so at the current price of 22.5 KPLC is fairly priced...most industrials trade at a fair PE of 10.
@the deal the information memorandum projects 2011 profits to grow 12%..
Where do you get your figures of 5% by 2014
Oh pole still even if KPLC achieves an a 12% increase in PAT...forward PE at 27 bob will still be above 10 i consider counters with forward PE's below 10 to be Undervalued...
look at this...KPLC compaired to its
peers..
NamPower posts healthy figures for 2010
The Namibia Power Corporation (NamPower) has recorded an increase in the sale of electricity, up from N$ 1.4 billion last year to N$ 1.7 billion in 2010.
The national power utility, however, only recorded a net profit of N$ 264 million after tax in the 2009/2010 financial year, compared to N$ 527 million the previous year, while cash generated from operations also decreased from N$ 592 million in 2009 to N$ 494 million this year. – Nampa
1N$=Ksh 11.6
Namibia has a population of 2 Million.