Home » Enel collapses to -5%, sinking the Ftse Mib, Spain move derails the Italian utility

Enel collapses to -5%, sinking the Ftse Mib, Spain move derails the Italian utility

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New downward tear in the Enel stock, which dropped around 5% to € 7.054, the lowest since November 2020. Being the heaviest share of the Ftse Mib, Enel’s fall weighs down the Italian leading index which marks -0, 8% on the minimum of the day.

Sales on the Italian electricity giant are driven by the move of the Spanish government which intends to calm the bills by recovering 2.6 billion euros from the energy companies until next March, forcing them to return the “extraordinary profits they have made” by virtue of the increase of gas prices in the wholesale market.

Enel is very exposed to the Spanish market. The subsidiary Endesa represents approximately 30% of the group’s EBITDA.

Equita points out that the Spanish government’s move is negative since it is a worsening of the regulatory environment and the impact for Enel will need to be clarified in detail and could range from a worst case one off of 1 billion euros to a best case of around 100- 200 million in the case of counting of hedges already closed. The Milanese sim believes that there is currently no risk in Italy of a solution as in Spain with interventions to the detriment of electricity operators, but the government would seek a solution that would lead to an elimination of the general charges in the bill, already circulated in the newspapers in recent days, and the movement of other items on general taxation.

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