Feb 1, 2023
Petro Plan to Cut Utility Bills Sinks Colombia Power Companies
(Bloomberg) -- Shares in Colombian power company Interconexion Electrica SA fell 2.5% in Bogota on Wednesday, extending a selloff that began when President Gustavo Petro said last week that he’d temporarily take responsibility for setting household utility bills.
The shares are down 11.5% since Petro’s speech, the biggest drop in the benchmark Colcap index.
Shares in energy holding Grupo Energia Bogota SA have fallen 7.2% over the same period, while electricity generator Celsia SA has dropped 5.2%.
In a speech Thursday, Petro cited an article of the constitution that he says allows him to manage public services instead of delegating duties to regulators.
The announcement “adds further uncertainty, which should likely increase volatility” in the shares of ISA, GEB, Celsia, Credicorp Capital analysts wrote in a Jan. 31 note. It may also affect Enel Americas SA —which trades in Chile but has investments in Colombia— they wrote.
Given that the government hasn’t provided further information on its plans, investors are waiting for more clarity, according to Credicorp.
--With assistance from Oscar Medina.
©2023 Bloomberg L.P.
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