Wood & Co. - plány PKN + 80 Kč na akcii

Conclusion : Under bullish 04 macro assumptions the incremental target price increase would be CZK 80/share (see our yesterdays morning note). The "mid-cycle" assumptions add CZK 25/share to our current target price of CZK 215. Major points from the presentation yesterday include:

· Since June 2005 Unipetrol has already added EUR 28 mil to EBITDA due to cost savings and or revenue enhanccement
· CAPEX to achieve 08E targets is minimal (~ EUR 16mil)
· Centralized crude oil procurement agreement is “significant” source of synergies
· Unipetrol plans to divest Kaucuk (risk to minority shareholders is acceptable)
· Unipetrol plans to acquire other retail networks (in play are smaller foreign or larger domestic networks).
· PKN ADMITTED THAT MOST OF SYNERGIES WILL ACCRUE TO UNIPETROL
· Further details will come in PKN/Unipetrol strategy update in January 2006

Recommend .: Price target: CZK 215. HOLD.