Lalpir Power Limited, an independent power producer, is up for grabs (Book Building process to conclude today) in less than a month’s time (IPO for general public)

   To value the company, we have employed the dividend discount model and relative dividend yield method to arrive at our TP of PKR22.5/sh for Lalpir Power Ltd (DDM value at PKR19/sh)

   The company’s tariff structure is made as such that there is a dip in the non-escalable component of the capacity purchase price in CY14

   However, post CY14, the company will experience an earnings rebound on account of the life extension activities being done on the plant

   We advice our investors to keep their pockets open till PKR22.5/sh either in book building or IPO,which will offer an attractive dividend yield of 13.7% for CY13