Ann: EastLink Traffic - May 2011 , page-10

Hi Woody

Concur with your post.

Monthly reports from CEU will show some growth, every month, and there will be 12 every year.

The bigger growth of this stock will be in 2 ways:
1. The relentless growth of Melbourne's South Eastern boundary and suburbs, and the advantageous spurt from Peninsula Link, 2013 if all goes to plan. Peninsula Link will make Eastlink a usable route, and open up the south. Once it opens I imagine the monthly % will increase to 15 or 16%. This is not indefinite. CEU has a lease, as follows, from their website:

"ConnectEast Group is the concessionaire for EastLink. Under its Concession Deed with the State of Victoria, ConnectEast is contracted to finance, design and construct EastLink and then operate it as toll road until 2043. ConnectEast listed on the Australian Securities Exchange (ASX Code: CEU) in November 2004 and now has around 30,000 investors with more than 13,000 of these living in Victoria."


2. The possibility of a takeover, slim, but nonetheless possible, by a bigger infrastructure player.

I am not an expert at analyzing fin reports, so I cannot speak and say the debt will be paid off well before the expiry of the lease, and what the dividends will be before that.

But any entries would be warmly welcomed.

Must head into port now.
Cheers