Drax’s trading update confirms consensus expectations and the pumped hydro business in particular is seeing strong performance. Biomass is also finding new outlets with demand from a growing biofuels market and we see this continuing in the medium term. We have increased our forecasts for FY23 and FY 24 to reflect better capture of power market volatility at Cruachan putting EBTIDA at £1,158m and £1,181m respectively and our central valuation moves to 1063p from 1049p.
