It is often not the case that an Czech company buys property abroad. And not in the same style as the recent Czech energy giant EZ. The company succeeded in the competition for the distribution of the company in Bulgaria, which was the largest investment abroad, and after the tender for the Slovak power plant (which is not lost) it is preparing for further acquisitions. How are the results given to him?
EZ as was established in 1992 by the National Property Fund, which is still its majority owner. The primary subject of the company’s activity is the production, purchase, distribution and sale of electricity and the related support of the service. Other important activities are the production, sale and distribution of heat.
Between 1992 and 1998, the company spent more than K 45 billion on an environmental program in connection with the decommissioning of power plants. In the following years, a modernized power plant in Dukovany was completed and a power plant in Temeln was completed. In 2003, the EZ group was formed in connection with regional distribution companies.
The electricity market is currently distinguished liberalize and changes in European and Czech legislation, which is one of the main factors, will, according to experts, affect the day in energy. Among the biggest changes planned is the division of energy trade and energy transport routes and then the opening of the market to European suppliers. Related to this is the increasing competitive environment in which EZ wants to stand up and become one of the key players in the market. EZ currently occupies 2% of the European market and thus ranks nine among energy companies. It is also one of the leading companies in the export of electricity.
Stocks are rising. How long to go?
On capital market pat today shares EZ company among the most popular titles. Their price has exceeded its maximum value several times in recent months and weeks. There is still potential for growth, although the company’s shares have appreciated by more than 70% this year, and in the last two years their price has even increased more than threefold. This trend is supported by many factors.
Development of EZ share prices over the last year and the volume of traded pieces
Source: Prague Stock Exchange
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Among the most important facts supporting the constant growth of the value of the action is in recent weeks the increase in wholesale electricity prices for five years. Although the price did not rise by the originally expected average of 14%. Due to the growth in demand, the price will increase by only 11%. However, there is a significant increase in revenues from the sale of electricity for five years, and together with the increase in energy prices in foreign markets, this fact creates good conditions for rising prices.
He gave a very often discussed and medically dissected fact is the expansionary policy of society. According to the company, the largest growth of EZ is mainly focused on the markets of Central and Eastern Europe. In addition, EZ is able to finance its activities from its own cash flow at the current low debt.
The first hurry of the company was the privatization of three Bulgarian distribution companies in which EZ acquired one of the three groups offered. The interest in the Bulgarian company is still going on, as is the privatization of electricity producers. In addition, the European States, which are about to privatize the energy sector, are on the agenda. Talk about Bosnia and Herzegovina, Croatia, Macedonia, Ukraine, Moldova, Serbia, or so Cyprus. The highest priority is still neighboring countries, ie Slovakia and Poland.
However, the tender for two Romanian distribution companies, in which 24.6% of the shares are for sale and the investor will have to increase his share to 51% with the invested capital, is showing the most mature in the near future. EZu is written in a big way and is the least balanced opponent of the E-on company.
Most of the experts agree on the view of the temporary failure in the tender for Slovenské elektrrne, which the Czech company lost to the Italian Enel. As the offer of EZu was evaluated by some companies as very aggressive, the lack of a company can be considered a good one at first, because it eliminates the risk of finding problematic companies. Lastly, however, suggest that one Slovak government and Enel will rise. It will therefore be very interesting to see how the situation develops in the end. In case of failure, the first EZ, which offered the second highest price, would fall into the balance.
Last but not least, sales of 34% in Prask energetika, J&T bank for 4.4 billion K and 34% in EPS sttu for 7.1 billion K also had an impact on the favorable development of EZ’s shares. that the originally planned privatization of 16% of the company is not planned in the near future.
Nen eho se bt?
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Unlike the positive ones, there are first negative currencies. Disruptions in the Temeln Nuclear Power Plant may affect the price of the event in the short term, but in the long run these should not be very important at first. The problem of the company itself may be the steep growth of the event in recent times, because when the market changes, investors tend to maximize their returns by selling the largest possible number of shares. In the case of a large foreign investor, such a sale will put a lot of pressure on the price to fall. The need for market integration, which is associated with data in the amount of several billion crowns, may cause it.
In the long run, EZ is rated as good investment. spchy pi minulch acquisitions The combined good prospects for giving a different scope of debt from the company of an aggressive investor, who are becoming a very strong regional game.
Do you think that the company EZ can gain a foothold in the energy market in the strong competition of large Western European companies? How long, according to vs, will the rise in prices of his action continue? Dark on your nzory.