Genex Power reported that it had reached completion on 85% of scheduled activities for construction of the Jemalong solar plant.

The company has also finalised its arrangements with UGL Pty Ltd (UGL), which was operating the Kidston Solar Plant (KS1) for Genex Power. Due to performance issues, UGL has agreed to pay $2.5m to the company and the operating contract is out for tender. The solar forecast output was reduced by-24%, but revenue was supported by UGL payments.

Because a large amount of the upside potential is attributable to Kidston Hydro project (K2-H), Morgans warns it is important for investors to realise that there are significant risks in Genex Power as financial close is not guaranteed.

The Speculative Buy rating and target price of $0.36 are unchanged.

Sector: Utilities.

Target price is $0.36.Current Price is $0.19. Difference: $0.17 - (brackets indicate current price is over target). If GNX meets the Morgans target it will return approximately 47% (excluding dividends, fees and charges - negative figures indicate an expected loss).

© 2020 Acquisdata Pty Ltd., source FN Arena