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Energy: Alternative Energy

Ror Ngor. 4 to benefit GUNKUL, BCP Neutral

Energy: Alternative Energy

- Solar rooftop can proceed within one month

National Council for Peace and Order (NCPO) agrees to stimulate the economy by

supporting private companies that are ready for investment as soon as possible.

Ministry of Industry will readjust the issuance process of the permit for factory

operation (Ror Ngor. 4) to reduce time. Thus, 870 factories and investment

projects (including solar rooftop projects) waiting for the government’s approval

will be able to proceed within 30-45 days.

- Positive factor for bid winners

This is a positive factor for alternative energy business, especially the companies

that won the auction for permission from the Ministry of Energy to run solar

rooftop business e.g. GUNKUL, BCP, WHA and DEMCO; they cannot start their

project because they are waiting for Ror Ngor. 4 to be issued. As Ror Ngor. 4 will

be approved by NCPO within 30-45 days, solar rooftop projects will be able to

proceed soon. Joint venture of SPCG (74.99%) and WHA (25.01%) was

terminated on September 2, 2013, but this is already included in our earnings

forecast and fair value. Though the positive factor has no significant effect on

GUNKUL and BCP’s earnings forecast, it relieves concern about solar rooftop

projects. Also, these companies would have potential to win the next round of

auction for solar rooftop business permission. The first auction comprises only

39.34 megawatt of solar rooftop energy, 39.34% of total solar rooftop energy

permitted by the Ministry of Energy (100 megawatt total). GUNKUL and BCP are

possibly winners of the next round of auction.

- Speculate on GUNKUL, BCP

We recommend speculating on stocks that benefit from progresses on solar

rooftop projects: GUNKUL(HOLD: FV13B), BCP (BUY:FV36B), DEMCO(N/A),

WHA(N/A), UAC(N/A) and EPCO(N/A).


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