"We view the asset positively from an energy security perspective, as it supplies around 10% of Singapore’s electricity needs. Its hydrogen compatibility effectively extends the asset’s runway and improves visibility of the capacity tolling agreement beyond 2040, strengthening KIT’s income resilience," state Li and Lim.
CGS International analysts Li Jialin and Lim Siew Khee have maintained their 'add' call and 60 cents target price for Keppel Infrastructure Trust following plans to increase its stake in a power plant from 51% to 90% for $128.1 million. The remaining 10% of the Keppel Merlimau Cogens plant will still be held by Keppel Energy.
Under a capacity tolling agreement which matures in June 2040, the 1,300MW gas-fired plant receives a fixed capacity payment from Keppel Electric.
