This report is an updated version of the report published on 3 November 2023 at 3:55 PM AEDT.

Genex Power Limited (ASX: GNX)

Genex Power Limited is an Australia-based energy and storage company with involvement in the development of a portfolio of renewable energy generation and storage projects across Australia.

Investment Rationale – SELL at AUD 0.1600

• Financial Decline: In 1QFY24 (September 2023 ending quarter), GNX’ 50MW Kidston Solar Project and 50MW Jemalong Solar Project generated nearly 30,224MWh and 22,878MWh of renewable energy, respectively. Despite favourable energy generation, GNX has been reporting negative profitability. In 1QFY24, the net cash flow from operating activities stood at an outflow of AUD 3,456k.
• Technical Indicator: The momentum oscillator 14-Day RSI (~55.74) was hovering in the mid-range and suggesting an indecisive action.
• Business Update: On 3 November 2023, GNX announced that its EPC contractor completed the evacuation of the Main Access Tunnel within the high quality rock conditions for the Kidston Pumped Storage Hydro Project.
• Key Risks: GNX is exposed to seasonal daytime pricing volatility, recurring fixed costs of the halted Bouldercombe Battery Project, and inflationary pressure on operating costs are key challenges to consider.

GNX Daily Chart

Considering the changes in market sentiments, stock price hovering near the first resistance, current trading levels and risks associated, it is prudent to book profit at the current levels. Hence, a 'Sell' rating is given on the stock at the closing market price of AUD 0.1600, up by ~7.526% as on 3 November 2023.

Note: This report may be updated with details around fundamental and technical analysis, price/ chart in due course, as appropriate.

Note 1: Past performance is neither an indicator nor a guarantee of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is 3 November 2023. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Note 4: Dividend Yield may vary as per the stock price movement. 

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and downtrend may take a pause backed by demand or buying interest.

Resistance: A level at which the stock prices tend to find resistance when they are rising, and uptrend may take a pause due to profit booking or selling interest.

Stop-loss: In general, it is a level to protect further losses in case of any unfavourable movement in the stock prices.