Kot Addu Power Company (KAPCO): Independent Power and Renewable Electricity Producers. Pakistan – By EFG Research

<ul><li><span style="font-family:Arial, Helvetica, sans-serif;font-size:medium;">We initiate coverage on KAPCO, Pakistan&rsquo;s single largest and oldest IPP complex, with a Buy rating and TP of PKR62.4. The crux of the investment decision is whether the tariff will be extended in 2021. We have a strong conviction that the tariff will be extended and that the recent share price weakness is a good entry opportunity. Using a FCF-based valuation methodology, we derive our target price of PKR62.4, which implies 119% upside. Furthermore, even if the tariff extension does not go through, we believe the gradual clearance of receivables/payables post the tariff expiry still offers more to investors than the current valuation implies.</span></li><li><span style="font-family:Arial, Helvetica, sans-serif;font-size:medium;">Given a backdrop ...