ENIC - Enel Chile's Long Duration PPAs Subject To Risks In Tight Global Supply

• Enel Chile's purchase price agreements with off-takers are reverse indexed to commodities and to the value of the Chilean peso.
• Supply side tightness globally plays doubly against Chile, as high commodity prices, especially copper, have a direct effect and indirect effect on PPAs through FX.
• However, Enel Chile's price is very low, and the markets have obviously taken into account the company's woes.
• The dividend is well covered, but since global supply tightness will be an ongoing issue, we'll wait till there's a light at the end of the tunnel before adding at lower levels.

For further details see: