OREANDA-NEWS. October 28, 2010. The National Electricity Regulatory Commission (NERC) increased the KIEN’s investment component by 10.4% to UAH 178.3mn, the Company representative announced Oct 27. The funds are supposed to come from the extra profits the company should receive from above-target electricity sales in 2010. The news corresponds with the KIEN’s intention to invest UAH 163mn in the electricity and heat distribution grid in 2011.

We see this news as POSITIVE foe KIEN, as the company is now available to invest in modernization of existing and construction of new facilities on the eve of the Euro-2012. Also, we consider the increase of the investment component to be primarily driven by the Company’s strong 3Q2010 earnings (net income of UAH 837.4mn vs 2Q2010 loss of UAH 195.8mn).