CII - SELL - The Math Doesn’t Work - Initiation
While cash-generating infrastructure investments would appear attractive, our analysis of CII shows that its toll fee projects (at 50% of assets) have an extremely low IRR and lack upside. Its other investments are unattractive, except for its water project (at just 5% of assets). The company also has a CB outstanding that caps any upside. As if this weren’t enough, questionable cross-shareholding transactions with its subsidiaries are difficult to understand.