Eni SpA ADR

This is our first report on Italian oil and gas major, Eni SpA. The company delivered an excellent result which was an all-around beat and made noteworthy strategic advances. Despite shortfall in the refining margins and lower crude oil prices, net income rose. Despite a weaker margin, the results of Energy Evolution in R&M were good. In the quarter, the Italian activities have registered a negative performance. Refining and Marketing reported an excellent quarter, the results achieved through dynamic management of feedstock and energy cost and the reliable and safe running of the refineries. However, Versalis had a challenging period. Eni took delivery at its Gela biorefinery, the foremost producer of cargo vegetable oil at its agri-hub in Kenya. Eni is also investing in building a new bio-refinery at the industrial site of Eni in Livorno. The company is further developing its renewable utility-scale business. The Vargronn joint venture of Eni with HitecVision was expanded to incorporate the Dogger Bank project in the U.K. We initiate coverage on the stock of Eni with a ‘Hold’ rating.