Africa Oil Initiated Overweight, is Buying Opportunity, JPM Says
2015-06-09 06:19:01.2 GMT
By James Cone
(Bloomberg) -- Mkt appears to have “subdued” expectations
for Africa Oil, is an opportunity to buy on current weakness,
JPMorgan says in note, initiating at overweight.
* JPM: South Lokichar “success story” underpins valuation,
S/T priority is to de-risk resource potential, cost analysis
*
* Sees farm-down by end 2016, conclusion will be major de-
risking of project
* Has transaction tax “hurdle” in Kenya, farm-down won’t
incur capital gains tax so may be most likely way to
unlock value
* Funding concerns remain, still underfunded even as
resources move in right direction; may need at least one
more round of fund raising
* PT SEK23.50 is 47% above yday’s closing price, 2.2% below
avg PT SEK24
For Related News and Information:
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To contact the reporter on this story:
James Cone in London at +44-20-3525-2572 or
jcone@bloomberg.net
To contact the editor responsible for this story:
James Ludden at +44-20-3525-2645 or
jludden@bloomberg.net
2015-06-09 06:19:01.2 GMT
By James Cone
(Bloomberg) -- Mkt appears to have “subdued” expectations
for Africa Oil, is an opportunity to buy on current weakness,
JPMorgan says in note, initiating at overweight.
* JPM: South Lokichar “success story” underpins valuation,
S/T priority is to de-risk resource potential, cost analysis
*
* Sees farm-down by end 2016, conclusion will be major de-
risking of project
* Has transaction tax “hurdle” in Kenya, farm-down won’t
incur capital gains tax so may be most likely way to
unlock value
* Funding concerns remain, still underfunded even as
resources move in right direction; may need at least one
more round of fund raising
* PT SEK23.50 is 47% above yday’s closing price, 2.2% below
avg PT SEK24
For Related News and Information:
First Word scrolling panel: FIRST<GO>
First Word newswire: NH BFW<GO>
To contact the reporter on this story:
James Cone in London at +44-20-3525-2572 or
jcone@bloomberg.net
To contact the editor responsible for this story:
James Ludden at +44-20-3525-2645 or
jludden@bloomberg.net