Rafako – Quarterly forecasts
In our opinion the majority of the risk factors that could hurt the Company have already materialized and we do not see any further strong negative catalysts in the ST.
A blowdown and wash-down process of the boiler ended in Jaworzno which contributed to cleaning of pressure surfaces of the unit from possible contaminant leftovers after the mechanical assembly. At the moment the hot start of the unit is underway and the first syncing of the unit with the electrical grid will be attempted.
Then any possible defects may be detected. Rafako and Tauron have agreed on a new date of the works completion so the Company has additional time to ensure the investment is buttoned up which provides a kind of a safety buffer.
Given no ST risk factors and vanishing of the negative sentiment after poor 2Q19 results we upgrade our ST relative rating to Neutral from Underweight. We believe the Jaworzno investment completion on time is still under the big question mark and that’s why we maintain our LT fundamental recommendation at Hold despite a huge upside (c. 80%). Our 12M EFV drops to PLN 1.8 per share from 2.3 previously.
Rafako SA (Fabryka Kotlow Rafako SA) is a Poland-based company engaged in the design, development and manufacture of industrial and power-generation boilers. It produces and sells a range of boilers fired with coal, oil, gas or a combination of these fuels, as well as other boilers, including fluidized bed boilers and biomass-fired boilers. The Company also provides diagnostics, repairs and overhauls of boilers and boiler auxiliaries. In addition, it is involved in the production of turnkey flue-gas desulphurization, environmental protection, municipal and industrial waste incineration plants, the provision of boiler pressure parts, and the production of boiler components. It is active domestically and abroad, including such countries as: Finland, Germany, France, the Czech Republic, Austria and Denmark, among others.
BOS Brokerage, with over 20-year experience, offers brokerage services on the Polish capital market to satisfy numerous needs of institutional and retail investors.
Our comprehensive offer includes brokerage services on both the stock exchange and the forex market as well as brokerage services on the energy market, debt and equity issues, distribution of investment funds and assets management.
BOS Brokerage analytical team belongs to the most appreciated and acclaimed on the market. According to Parkiet daily’s poll (as of January 7, 2019), DM BOŚ equity research team was selected by institutional investors as the third best in Poland. Moreover, the team members won several individual best analysts awards, including Sobiesław Pająk – IT (best analyst), media/telco (ranked 2.), strategy (ranked 4.), Tomasz Rodak – video games (best analyst), overall ranked 5., Łukasz Prokopiuk – chemicals (ranked 2.), mining (ranked 3.), Maciej Wewiórski – real estate (ranked 3.).
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The analysts handle over 80 companies listed on the Warsaw Stock Exchange.
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