The State Treasury Deputy Minister Mr. Dabrowski said that if KGHM would present a convincing capital expenditure plan for the next year, the State Treasury, which owns a controlling stake in KGHM, would not push for an outstandingly high dividend payout (88% payout ratio this year).
Our view: We view the news as neutral. KGHM management indicated recently that in its new strategy to be announced by mid November it is going to increase spending on raising copper output. We also have not heard for a while about dubious projects such as telecommunications, IT, etc. We reiterate our Buy rating for the stock.