OREANDA-NEWS. March 25, 2010. AFK Sistema sees the creation of the most expensive electric utility in the country as one of the top-priority tasks of its energy subdivision, Sistema spokesperson, Petr Bezukladnikov said. The projected value of the future company has been defined at USD 10 billion, while its total installed capacity is projected at around 20 GW. Meanwhile, Sistema is likely to be quite selective about the quality and price of newly acquired assets.

Today, Sistema’s core electric utility asset is Bashkirenergo, valued by the market at USD 417 on EV/IC. With account for the made statements, one kilowatt of installed capacity in the future energy giant has been valued at USD 500. Therefore, we expect the news to have a limited impact on Bashkirenergo stock valuations, as the company’s current price is only 20% lower than the potential value of the future company. Meanwhile, the objective to create a top-priced electric utility looks quite ambitious and optimistic, which could elicit a positive response from long-term investors.