Opg Power Ventures Share Discussion Threads

[basem1] 31/5/2024 10:13

Let's have some volume through and our pesky seller may clear out

[basem1] 31/5/2024 08:14

Could this be the last of the overhang clearing ? 150k yesterday and 100k Or just wishful thinking on my part

[rivaldo] 21/5/2024 22:54

Nice move up today.

Not quite sure why as today's buying was mostly done at 11.4p-11.6p - with one rogue small buy at 12p.

Perhaps there'll be some late trades reported tomorrow, or just maybe - hallelujah! - the seller is finally out.

[basem1] 16/5/2024 11:06

Added a few more today

[basem1] 15/5/2024 12:52

Might have to go down before we can go upLet's hope not

[basem1] 15/5/2024 12:51

That was myself But hope I do not live to regret it How much of an overhang is left is anyones guess

[rivaldo] 15/5/2024 12:41

If it's not a stock he follows it should be!

Nice 225,000 buy at 11.64p just reported from earlier today.

[basem1] 15/5/2024 10:27

Could ST of investors chronicle give this a lift early next week ? Not sure it is a stock he follows

[rivaldo] 14/5/2024 14:52

Loads of 1 share Buys going through. Must be code for Buy, Buy, Buy!

[rivaldo] 14/5/2024 12:46

Cavendish have a 27p target price - over 100% upside from here.

They conclude:

"We estimate that the replacement cost of OPG’s Chennai plants would be around £325m based on the projections by the Indian government for additional capacity to be installed in India by 2030. Meanwhile, on the operating cost side, we note that coal prices remain significantly lower than their levels from FY22 and FY23, with further supply expected to come online during the next two years. With favourable trends on both electricity demand and costs, we believe that OPG is well positioned to return to annual EBITDA of £3040m in the medium-term, a level which was achieved in each of FY19, FY20 and FY21.

- Investment conclusion:

Based on medium-term prospective EBITDA of £30-40m, the current valuation represents a multiple of 1.4-1.8x. The company also benefits from a low degree of balance sheet leverage relative to other electricity utilities in India, as well as an asset base which positions OPG at the lower end of the cost curve for Indian electricity producers. We reiterate a target price of 27p, which would represent a 2.5-3.3x EBITDA multiple based on our mediumterm estimate range of £30-40m EBITDA."

[igoe104] 14/5/2024 12:24

Cavendish upgrades.

OPG Power has released a positive trading update for the year ended 31 March 2024, and now expects to exceed previous market expectations at the EBITDA and revenue level. The company continued to benefit from a stronger revenue run-rate during H2/24 compared with FY23, reflecting greater availability of profitable supply contracts, which in turn have enabled OPG to run at higher levels of plant utilisation. We are raising our revenue forecast for FY24 by 22% to £162m, and our EBITDA by 34% to £1

[the original goldbug] 14/5/2024 11:31

Why has the margin been worse in the second half. I would have thought margins would have been improving.

[z1co] 14/5/2024 11:04

Trading in H2 has been far stronger than H1.

For H1:

Revenue £69.9m
EBITDA £7.8m

For the year :

Revenue at least £160m
EBITDA at least £16m

[tim000] 14/5/2024 10:24

Fair question. Returning surplus capital to shareholders will surely happen, but we’ve no idea when. The deleveraging policy has been in place for many years now, and has substantially reduced the annual interest bill. It will also have reduced the premium they have to pay for funds over the base rate. At some point, they will judge they have a fully sustainable level of debt over the economic cycle and will then return a proportion of FCF back to shareholders in dividends and/or buybacks. But they don’t like to prejudge the issue, having seen shocks like Covid and the Ukraine war come from nowhere. That means we’re probably not going to get much forward guidance on the issue.

[jeffian] 14/5/2024 10:14

"The Company will continue to generate strong cash flows from operations and deleverage its balance sheet to maximise returns to its shareholders."

Much talk of "returns to shareholders" but, other than deleveraging the balance sheet, it's not entirely clear what these "returns" would involve. It would be quite nice to have something more tangible!

[nigoil] 14/5/2024 09:10

How's your 2.3p PPP shares doing purple11?......LOL

Simples!........;-)

[z1co] 14/5/2024 08:56

In auction but offer price is increased to 12p again on solid buying.

Like you rivaldo i have also taken advantage of this pullback.

[rivaldo] 14/5/2024 08:46

I've bought some more on this dip - looks like the price is turning back up. Hopefully the seller is finally out.

OPG looks extremely cheap now imho.

[purple11] 14/5/2024 08:08

uh oh!

Zico the Clowns about

[z1co] 14/5/2024 08:05

A very solid update , trading well ahead of expectations.

[philjeans] 14/5/2024 08:02

Cracking figures; excellent prospects; miles to go!

[tim000] 14/5/2024 07:40

The company has said it is transitioning away from supplying lower-margin spot contracts towards longer-term, higher margin contracts but with slower receivables. So the reduction in net debt should understate the company’s improvement in liquidity - ie more resources are tied up in working capital for a few months, but will soon generate lots of cash flow.

[rivaldo] 14/5/2024 07:38

Cheers tim000 - so OPG have actually not just exceeded, but smashed expectations....

[tim000] 14/5/2024 07:35

Cavendish were forecasting adj EBITDA of £12mn and net debt of £16.1mn.

[rivaldo] 14/5/2024 07:27

Lovely:

"the Company expects to report FY24 revenues and EBITDA of no less than £160 Mn and £16 Mn, respectively, exceeding market expectations"

Plus net debt is down to a measly £12m.

Could be a big move up here.