Analyst Note
| Tancrede Fulop, CFA |We maintain our fair value estimate of GBX 800 per share along with our no-moat, stable trend ratings after National Grid announced that it will continue to increase its dividend in line with inflation and said it was comfortable with the likely credit rating downgrade it will entail. The expected dividend on fiscal 2021 is GBX 0.5, implying a 6% yield. The company will also appeal the RIIO-2's cost of equity to the competition and markets authority, the CMA. Shares appear fairly valued. For investors seeking a regulated utility paying high dividend, we would recommend undervalued Red Electrica.