current prices = 7.5% dividend (0% franked), page-3

commsec report on toll roads here is what Commsec have to say on toll roads - they like them!
"Recent weakness in the prices of toll road stocks is partly attributed to short-term inflation concerns. The strength of the
domestic economy and rising oil prices led to market fears that long-term bond yields will rise from their current lows.
Toll road valuations are sensitive to both bond yields and future inflation. Historically, the share prices of MIG and TCL
have been inversely correlated with nominal bond yields. We believe this correlation is too strong, particularly in the
case of MIG.
In the absence of tolling constraints, if higher bond yields simply reflect higher inflation, capital costs will rise to offset
higher cash flows — with no or little impact on valuations.
Our analysis indicates that toll road stocks are sensitive to changes in long-term bond yields and future inflation. TCL is
the most sensitive; with CEU and MIG the least sensitive.
The reason is that TCL’s roads have caps on the nominal value of tolls; CEU’s tolls increase with inflation; while tolls on
MIG’s major roads are flexible. If inflation increases, TCL’s tolls do not increase, yet we expect an increase in its cost of
capital. Hence our TCL valuation falls. MIG’s and CEU’s tolls do increase with inflation, offsetting the increase in the
cost of capital.
A 1% increase in inflation, with real long-term bond yields held constant, reduces TCL’s value by 11.1%; followed by a
3.7% fall for CEU and a 3.6% fall for MIG."