A turnaround in Eskom's finances has won praise from investors but they are keeping their eyes on the next big problem.
A turnaround in Eskom 's finances has won praise from investors but they are keeping their eyes on the next big problem.
It could also put at risk investors’ new-found goodwill towards a company that was seen as symbol of chronic dysfunction but is now about to turn its first profit in nearly a decade. Blamed for years of rolling electricity blackouts, it’s managed to keep the lights on for nine months in a row, offering hope to the power-starved economy.
“The municipal debt problem is of ongoing — and growing — concern,” Constantatos said. “The growing scale of the problem requires immediate and decisive interventions and some tough trade-offs by government, which historically has been a challenge for this and previous administrations.” For now, investors are giving Eskom the benefit of the doubt. State Street Liquidity, JPMorgan Investment Management, Abrdn and Thrivent Financial were among the funds that added to holdings of Eskom’s 2028 bonds in the latest quarter, filings show.The extra yield investors demand to hold Eskom dollar debt without the benefit of a government guarantee has slipped to the lowest on record.
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