The Sunraysia update highlights a solar construction sector unappealing to contractors in our view. Despite DCG having performed the physical works necessary under its EPC contract, an inability for Sunraysia to obtain R1 registration and achieve Substantial Completion has delayed ~$14m in progress payments to DCG. Further, Sunraysia has not awarded DCG an extension of time and adjustment to the contracted date for Completion. Our forecasts assume the issue is resolved (the only impact being a cash flow delay), however the heightened uncertainty indicates a HOLD call is appropriate.
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