Kinder Morgan Inc "Takeaways from NDR - Singapore and Japan" (Buy) Gupta

Research evidence excerpt

Kinder Morgan Inc "Takeaways from NDR - Singapore and Japan" (Buy) Gupta

ll allow KMI to Q3E 0.32 0.32

move this gas eastwards in higher demand markets. Expect Trident to generate Q4E 0.38 0.39

~30% of its full run rate contracted projected EBITDA in 2027, and 80% in 2028. 12/26E 1.50 1.49

First full year will be 2029. KMI could even possibly upsize the Trident pipe, given 12/27E 1.62 1.52

the volume of gas landing at Katy. 12/28E 1.80 1.66

The company is working with a number of hyperscalers to provide gas for power Manav Gupta

solutions, but is not looking to enter the power generation business or directly Analyst

manav.gupta@ubs.com

compete with its utility customers. Power generation carries higher risk and is not

+1-212-713 4399

an area of expertise for KMI.

Sumantra Banerjee

Newer projects will be generating higher rates of return than some existing assets. Associate Analyst

sumantra.banerjee@ubs.com

As new major projects start to come online in 2028, the EBITDA contribution from +1-212-713 5104

them is likely to push down leverage from current levels of 3.6x.

Saumya Jain

Management typically targets an average unlevered after-tax IRR of approximately Associate Analyst

+15% on projects. For lower-risk projects and customers with very high saumya.jain@ubs.com

creditworthiness, this target return may be lower. Conversely, higher-risk projects +1-212-882 0089

require higher returns.

Highlights (US$m) 12/23 12/24 12/25 12/26E 12/27E 12/28E 12/29E 12/30E

Revenues 14,882 14,709 16,497 17,799 18,059 18,751 19,587 20,229

EBIT (UBS) 5,245 5,534 5,938 6,350 6,611 7,032 7,224 7,573

Net earnings (UBS) 2,397 2,629 2,888 3,315 3,544 3,892 4,073 4,404

EPS (UBS, diluted) (US$) 1.07 1.18 1.30 1.50 1.62 1.80 1.91 2.09

DPS (net) (US$) 1.13 1.15 1.17 1.19 1.23 1.27 1.31 1.35