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Flash update from Kepler Trust Intelligence

The Department for Energy Security and Net Zero has launched a consultation on proposed changes to the inflation indexation used in the Renewable Obligation (RO) and Feed-in Tariff (FiT) schemes.  This has hit share prices across the renewables sector. It is important to realise that this is only a consultation, and not necessarily an inevitable change. The net result of a previous consultation in 2023, which covered fixed price certificates and included indexation arrangements, was that no amendments were made to indexation (or anything else). Whilst this recent news has added to the already challenging backdrop for the sector, the share price move for UKW seems extreme, such that the worst outcomes would appear to be more than accounted for by the current share price discount to NAV.

10/11/2025

Kepler View

If either proposal in the consultation were implemented, it would likely translate into a one-off hit to NAV. However, whilst UKW is clearly 100% exposed to the UK government subsidy regime (rather than other geographies), it has a mix of revenues streams across Renewable Obligation Certificates (ROCs), other subsidy schemes (such as CfDs) and market power prices. It is only the indexation mechanism on the RO and not value of the certificate itself that is up for debate within the consultation. The potential negative effects will also be mitigated by the relatively short remaining life of the ROCs in the portfolio (average remaining duration c. 7yrs) and we also note the structurally high dividend cover of UKW’s model. UKW also derives a significantly lower proportion of its revenues from the Renewables Obligation than solar peers, and so we would expect UKW to be significantly less affected than many in the listed peer group.

Fundamentally, UKW appears resilient. UKW’s structurally high dividend cover means that it has options to deploy surplus cashflows towards new investments, buybacks or reducing debt. We note that UKW continues to buy shares back, illustrating the confidence the board has in strength of the balance sheet. UKW’s conservative approach means there are likely to be considerable levers to pull in order to mitigate a sizeable amount of any potential impact.

Greencoat UK Wind FY25 total dividend target 10.35p vs 10p YoY

	Company Name	Place change
1	Artemis Global Income I Acc	Up 1
2	Royal London Short Term Money Mkt Y Acc	Down 1
3	Seraphim Space Investment Trust Ord SSIT3.30%	Unchanged
4	Greencoat UK Wind UKW0.05%	Up 5
5	Vanguard LifeStrategy 80% Equity A Acc	Down 1
6	Scottish Mortgage Ord SMT0.04%	Down 1
7	City of London Ord CTY0.18%	Unchanged
8	Artemis SmartGARP European Eq I Acc GBP	New
9	Vanguard FTSE Global All Cp Idx £ Acc	Up 1
10	HSBC FTSE All-World Index C Acc	Down 4

Royal London Short Term Money Mkt Y Acc has given up its place as the weekly ISA bestseller, ending a six-month spell at the top of the table.

The fund, which offers cash-like returns, has fallen to second place, displaced by the US-light Artemis Global Income I Acc, which returned roughly 45% in 2025.

The reshuffle partly reflects the sheer strength of returns from the Artemis fund, which takes the top spot for the first time. But there’s also a chance that the Royal London fund, and cash funds in general, could lose their shine as interest rates fall.

The Bank of England cut the rate to 3.75% in December and returns from cash funds (and cash accounts) have reduced in turn.

Investors could well now look to seemingly safe assets which pay out higher amounts, such as bonds, or even turn to riskier assets.

We’ve noted that Artemis is enjoying a moment in the sun, and another of its strong performers crops up in the list this week.

Artemis SmartGARP European Equity, which uses a proprietary screening tool to identify stock picks, returned roughly 56% last year and has a big allocation to financials, moves into the table in eighth place. The UK offering from the same franchise, Artemis SmartGARP UK Eq I Acc GBP, sits just outside the table in 15th place.

There’s the usual presence of global equity trackers (and one of Vanguard’s LifeStrategy funds) in the list, plus two very different investor favourites in the form of adventurous global growth fund Scottish Mortgage Ord  SMT

 and steady UK income play City of London Ord  CTY.

Elsewhere, it’s interesting to see two investment trusts with very different runs of performance in the top five.

With geopolitical strife back on the agenda, shares in Seraphim Space Investment Trust Ord  SSIT

many of whose holdings have been busy signing defence contracts, have returned almost 9% so far in 2026. That has pushed the shares on to a premium to net asset value (NAV), which at one point reached almost 18% last week but has since moderated to around the 9% mark.

Greencoat UK Wind  UKW

which has been in the wars amid a challenging few years for the renewable energy infrastructure sector, moves up to fourth place. It’s likely that investors still spy a bargain here, given that the shares trade on a roughly 31% discount and come with a dividend yield of more than 10%.

There are plenty of big yields now available in that sector, although this may suggest investors are sceptical about how sustainable they are. NextEnergy Solar Ord  NESF

shares now come with a yield just shy of 17%, for example.

Funds and trusts section written by Dave Baxter, senior fund content specialist at ii.

96 in com 96.comx normanelsa76

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Of course you can.

A general note about comments.

All comments are moderated and with the best will in the world no comments can be posted in a foreign language.

Although there is appeal for porn, otherwise there wouldn’t be so many sites, it’s not a suitable topic for this blog.

Ditto sex dolls.

Apologies if any comments slip thru the net.

Copied from the Watch List Below.

The yield is a blend of the future fcast yield and the historical yield. Here because of the takeover of Assura the yield may change.

Notice of interim dividend

The Company announces the first quarterly interim dividend in 2026 of 1.825 pence per ordinary share, equivalent to 7.3 pence on an annualised basis, which represents an increase of 2.8% over the dividend per share distributed in 2025 of 7.1 pence and will mark the 30^th year of consecutive dividend growth for PHP.  

The 1.825 pence dividend will be paid by way of a Property Income Distribution (“PID”) of 1.325 pence and an ordinary dividend of 0.500 pence on 13 March 2026 to shareholders on the register on 30 January 2026.

The Company intends to maintain its strategy of paying a progressive dividend, paid in equal quarterly instalments, that is covered by adjusted earnings in each financial year. Further dividend payments are planned to be made on a quarterly basis in May, August and November 2026 which are expected to comprise a mixture of both PID and normal dividend.

Share price £1.04 dividend 7.3p Yield 7%

You can only base your decisions on the statement from the company and take action if the future dividend changes.

There is no premium/discount to NAV as although the share is a REIT it’s an Investment Company, so you need to look at the Fair Value, which isn’t as reliable as a company’s NAV RNS.

NTAV is the capital minus any outstanding loans.

Trading Tip

Looking at the loans figure you can understand why REIT’s fall in value when interest rates rise and vice versa when they fall.

If you were lucky with your timing or new that REIT’s prices rise when interest rates fall, not all REIT’s so better to be lucky than clever, you would have made a TR return of 22%.

Which you may decide to take some or all of your profit and re-invest in another share, with a higher yield and discount to NAV.

Or maintain the holding and use the ‘secure’ dividend, no dividend is 100% secure

and re-invest the dividends in a higher yielder.

The Watch List will be reviewed at the end of the month and any shares that yield less than 5% will be deleted.

I’ve bought for the Snowball a further 1486 shares in FSFL for 1k.

I wanted to open a new position in the Snowball but that will have to wait, until later when markets flip over, until then

I’ve bought 1275 shares in DIG for 4k, completing the Snowball’s position in the share.

Cash for re-investment £3,532.00

I’ve sold the Snowball’s shares in BRAI for a short term profit of £302.00, mainly because I never managed to buy a full position before the share price rose.

A share I will most probably come back to.