Agree and nobody's talked about that up until you mentioned it and its a real risk that nobody seems to be factoring in. I rate First N.Z's research as better than anyone else and note they rate the company based on a comparitive PE basis to the other listed power companies at $1.43 - $1.60 but I don't agree with their risk assessment on either the smelter situation or Labour / Greens and believe they are materially underestimating the risks as i perceive them.
People are paying a PE of ~ 20 times in a zero growth industry with major risks of 41% of supply going to a smelter that's highly likely to close and when it does people seem to think it'll be easy to transfer that supply elsewhere, (something i'm not convinced of). Then we have the Labour Greens groundswell of support building on the fact that Mr Key stopped listening to average Joe Bloggs quite some time ago. All this against a background of real increases in electricity prices of circa 80% over the last decade to such an extent that many average families are struggling to pay their power bills and those that can are putting in efficient heat pumps and better insulation. Some think demand growth will get back to its long term trend after many years of zero growth, I am not convinced. New supply already in the pipeline coming on stream this year and next will further effect the present over-supply situation.
Too add insult to injury buying back an asset we as taxpayers already own feels like some sort of quassi taxation to me. I can see why people would look at this as an income stock but there are really serious risks with this stock, not the least of which is the timing of the float. I avoided the slow river power value destruction and will also sit this one out. My 2 cents.