Goldman Starts CLP At Buy

Goldman Starts CLP At Buy; Div Yield, Growth

Goldman Sachs starts CLP (0002.HK) with Buy call, 12-month target at HK$61.00; stock +1.5% at HK$51.20. Likes CLP for its 5% dividend yield, good track record in overseas expansion, diversified asset portfolio. Expects negotiation of post-2008 Scheme of Control (franchise agreement with HK government on power supply to city) to conclude in few months, removing key share price overhang. "We believe Hong Kong utilities will continue to seek better returns overseas, supplemented by their strong Hong Kong-generated cash flow." Possible future catalysts: HK government approval of LNG terminal, better results in Australian, Southeast Asian operations, lower interest rates.

CLP To Build 82.4MW Wind Farm In India For Over US$105 Mln

CLP Holdings Ltd. (0002.HK), the larger of Hong Kong's two power suppliers by revenue, said it plans to build a 82.4-megawatt wind farm in the southern Indian state of Karnataka for more than US$105 million. The wind farm, called the Saundatti project, will increase the renewable energy in CLP's total generation portfolio to 545 MW, or 4.9%, which is close to the 5% target it is aiming for by 2010, CLP said in a statement issued over the weekend. Construction of the Saundatti project will kick off by the end of next year and is expected to be completed by end-June 2009, CLP said. The wind farm, which will be wholly owned by CLP, will have 103 wind turbines, each with a capacity of 800 kilowatts, the statement said. CLP will order wind turbines from manufacturer Enercon (India) Ltd., it said. It will be CLP's third wind farm in India. It is building the 100.8-MW Samana wind farm, wholly owned by CLP, and 50.4-MW Khandke wind farm, in which CLP holds a 50% stake. In the same statement, CLP said it hopes to cut carbon dioxide emissions intensity by 5% to 0.8 kilogram a kilowatt-hour by 2010 from the current 0.84 kg a kWh. It also hopes to further reduce emissions to 0.7 kg a kWh by 2020, to 0.45 kg a kWh by 2035 and to 0.2 kg a kWh by 2050, the statement said. CLP has three operating wind farms in China and three in Australia. It also has an operating hydropower plant in China. The company is also building eight wind farms and a biomass power project in China