Berenberg ups Eni as potential Plenitude, Var Energi listings could unlock value

Grounded Lithium

01/12/2021 08:54

** Berenberg raises Italian energy company Eni  ENI.MI  to
"buy" from "hold", saying potential listings of its Plenitude
and Var Energi businesses could unlock hidden value for already
attractively valued stock      
    ** The broker cites IPO of around 20-30% of retail and
renewable (R&R) business, Plenitude, and potential listing of
Norwegian exploration and production (E&P) business, Var Energi,
as possible drivers 
    ** The brokerage estimates Var Energi and Plenitude to be
worth 11.5 billion euros ($13.04 billion) and between 6.8-9.6
billion euros, respectively 
    ** Ability to fund growth of R&R business's separately could
unchain capacity to improve returns for shareholders, Berenberg
notes
    ** It says, however, that it will depend on whether new
businesses will command multiples of standalone peers or market
will rate them at discount as Eni's continued majority ownership
of Plenitude could generate overhang concerns
    ** Broker adds listings driving higher value for stock will
also hinge on whether market will give full credit in Eni shares
for sum-of-the-parts valuation
    ** It says Eni valuation remains attractive, estimating
dividend yield of 8.2% in 2022
    ** Out of 29 analysts that cover Eni, 19 rate stock "strong
buy" or "buy", ​eight rate "hold" and two​ rate "strong sell" or
"sell"




($1 = 0.8819 euros)

 (Reporting by Federico Maccioni)
 ((Federico.maccioni@thomsonreuters.com))