{"id":324014,"date":"2023-07-13T00:30:37","date_gmt":"2023-07-12T16:30:37","guid":{"rendered":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/?p=324014"},"modified":"2023-07-13T00:30:38","modified_gmt":"2023-07-12T16:30:38","slug":"stock-in-focus-first-gen-corp-fgen-13-july-2023-by-ap-securities","status":"publish","type":"post","link":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/stock-in-focus-first-gen-corp-fgen-13-july-2023-by-ap-securities\/","title":{"rendered":"Stock in Focus: First Gen Corp. (FGEN) – 13 July 2023 by AP Securities"},"content":{"rendered":"\n

Summary of Broker’s Recommendation<\/h2>\n\n\n\n
Stock Code<\/strong><\/td>FGEN<\/td><\/tr>
Company Name<\/strong><\/td>First Gen Corp.<\/td><\/tr>
Broker<\/strong><\/td>AP Securities<\/td><\/tr>
Opinion Issued on<\/strong><\/td>13 July 2023<\/td><\/tr>
Recommendation<\/strong><\/td>Buy<\/td><\/tr>
1-Year Target Price<\/strong><\/td>PHP 27.30<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n

We have a BUY rating on FGEN with Target Price of P27.30 per share.<\/p>\n\n\n\n

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Analysis and Opinion<\/h2>\n\n\n\n

FGEN to receive first delivery of LNG by end-September<\/strong><\/p>\n\n\n\n

First Gen Corp. (FGEN) is set to receive its first shipment of 154,500 cubic meters of liquified natural gas (LNG) from Shell Eastern Trading Pte. Ltd. by the end of September. It is a key turning point in FGEN\u2019s business model, which has so far relied on piped natural gas from Malampaya Gas Field to power its four natgas power plants in Batangas. The company broke ground on constructing a LNG import terminal in its Clean Energy Complex in Batangas City in 2019 and procured a floating storage and regasification unit (FSRU) to ensure supply amidst dwindling output from Malampaya.<\/p>\n\n\n\n

An expensive pivot, but necessary<\/strong><\/p>\n\n\n\n

LNG prices on the world market is about $9.29\/mmBTU more expensive than piped natural gas, mostly due to processing and shipping costs. The price gap widened since 2022 as Europe also turns to LNG to reduce its reliance on piped gas from Russia following Putin\u2019s invasion of Ukraine. Piped gas from Malampaya is more expensive than the generic active contract, but still about $3.00\/mmBTU more expensive than LNG. <\/p>\n\n\n\n

However, the pivot to LNG is necessary as FGEN\u2019s four natgas facilities alone supply 20% of Luzon\u2019s energy needs, and analysts estimate that the Philippines will eventually need around 3.0-Mn tonnes of LNG per year to replace Malampaya\u2019s supply. To help complement the existing supply, FGEN and Prime Infra signed an agreement to operate a gas aggregation facility in the Batangas LNG terminal where imported LNG and piped gas from Malampaya can be blended together.<\/p>\n\n\n\n

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Check how many brokers recommend this stock<\/h2>\n\n\n\n
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All Stock Rankings<\/a><\/blockquote>