Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

Smartkarma

Smartkarma unites the fragmented investment industry, connecting institutional investors, independent research providers, and corporates within a single network.

Research Reinvented

Equity Capital Markets

We would avoid the deal given:<ol><li>The deal doesn't score well on our Momentum-Adjusted Deal Stag Framework on Track record (has under-performed peers and index over the past five years and generates sub-par sector ROE) and leverage (higher than peers) </li><li>While the stock has performed well in the past year, the longer term track record remains patchy on earnings</li><li>2015 remains a crucial year for the stock with the company set to commission its 100MW aeroderivative modular Avion project by April 2015, that will purely play the spot market. While analyst remain bullish on the prospects of the project given the tight demand-supply situation however, most still raise concerns on the execution risks given prior history.</li><li>The point above then begs the question of why raise now, if the stockholders would clearly be more willing to provide capital post commencement of Avion in April 2015?</li><li>While its a positive that the main shareholder (First Philippine Holdings - FPH PM) will take up 66% of the placement, in order to maintain its shareholding, however, the tight discount of 1-3% leaves a very small margin of error for momentum based investors.</li></ol>

We would avoid the deal given:The deal doesn't score well on our Momentum-Adjusted Deal Stag Framework on Track record (has under-performed peers and index over the past five years and generates sub-par sector ROE) and leverage (higher than peers) While the stock has performed well in the past year, the longer term track record remains patchy on earnings2015 remains a crucial year for the stock with the company set to commission its 100MW aeroderivative modular Avion project by April 2015, that will purely play the spot market. While analyst remain bullish on the prospects of the project given the tight demand-supply situation however, most still raise concerns on the execution risks given prior history.The point above then begs the question of why raise now, if the stockholders would clearly be more willing to provide capital post commencement of Avion in April 2015?While its a positive that the main shareholder (First Philippine Holdings - FPH PM) will take up 66% of the placement, in order to maintain its shareholding, however, the tight discount of 1-3% leaves a very small margin of error for momentum based investors.

FGEN PM - Avoid the deal given the tight spread and capacity execution risks

Philippines

First Gen Corporation is the holding company for the power generation and energy related businesses of the Lopez Group.  The Company's primary focus is on power generation.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

First Gen (FGEN PM)

FGEN PM - Avoid the deal given the tight spread and capacity execution risks

We would avoid the deal given: The deal doesn't score well on our Momentum-Adjusted Deal Stag Framework on Track record (has under-performed peers...

Sumeet Singh

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)