Renergen

JP: RENJ

ZAR1458.6m market cap

ZAR12.95 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

Following its ASX listing in June and the closing of its US$40m loan in late August with the US Overseas Private Investment Corporation, Renergen (REN) has triggered the final milestone to start construction of its Virginia Gas Project by appointing equipment supply contracts for its first LNG and liquid helium liquefiers. This sets Renergen on a trajectory for first LNG and helium production around mid-2021. The company is currently drilling a horizontal well targeting a prospective shallow sandstone that could yield elevated helium levels to its historic well with results expected imminently. Our pre-drill valuation of Renergen stands at 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 20/01/2020
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 (3.3) 55.3 58.1
Relative* (5.7) 47.0 44.4
52-week high/low ZAR14.3/ZAR7.4
*% relative to local index
Key management
Stefano Marani CEO
Fulu Ravele CFO
Nick Mitchell COO