Renergen

JP: RENJ

ZAR1092.6m market cap

ZAR9.5 last close

Renergen is an integrated alternative and renewable energy business that invests in early-stage alternative energy projects across Africa and emerging markets.

Investment summary

Activity in 2018 was slower than planned for Renergen as its expected funding of the Virginia LNG/helium project in South Africa was delayed due to a long period of economic and political volatility. However, with a recently completed rights issue that unlocks a pre-agreed debt facility, Renergen can now start to order key equipment. In September 2019, Renergen announced the appointment of Bohrmeister as the drilling contractor to undertake the drilling of a horizontal well in the Virginia Gas Project’s production area. The macro environment is favourable, with helium prices potentially higher after the cessation of public auctions of the US strategic helium reserve. In June 2019, Renergen completed its listing on the ASX raising new equity capital of ZAR105m. Our valuation is ZAR20.5/share.

Y/E Feb
Revenue (ZARm)
EBITDA (ZARm)
PBT (ZARm)
EPS (fd) (c)
P/E (x)
P/CF (x)
2018A 2.9 (26.9) (27.1) (0.3) N/A N/A
2019A 3.0 (43.2) (46.9) (0.5) N/A N/A
2020E 0.0 (52.0) (59.6) (0.5) N/A N/A
2021E 0.0 (52.0) (68.9) (0.6) N/A N/A
Industry outlook

Renergen is targeting the heavy-duty LNG truck market which is a rapidly evolving market globally. Meanwhile, helium prices are likely to remain buoyant following the shutdown of the US strategic reserve in 2018.

Last updated on 13/11/2019
Sector
Oil & gas
Share price graph
Balance sheet
Forecast net cash (ZARm) 4.8
Forecast gearing ratio (%) N/A
Price performance
%
1m
3m
12m
Actual 4.4 9.0 14.9
Relative* 2.5 4.7 6.3
52-week high/low ZAR11.1/ZAR7.2
*% relative to local index
Key management
Stefano Marani CEO
Fulu Ravele CFO
Nick Mitchell COO