Citi upbeat on Australia's Origin Energy, flags potential undervaluation
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** Analysts at Citi say wholesale volatility positively affects Australia-based Origin Energy's ORG.AX retail margins due to regulated tariffs, with the power producer's energy costs rising more slowly than the industry average
** Considering management's confidence in outperforming gross profit forecasts and the potential for recovery in certain costs, market may be undervaluing ORG's potential - Citi
** ORG, on Thursday, flagged weaker-than-expected forecasts for its main Energy Markets unitand higher coal costs, which led to an 11.5% drop in shares
** Citi trims ORG's PT by 50 Australian cents to A$11; retains "buy" rating for ORG stock
** "Compliance costs may have some partial recovery, though since some of this cost is ORG specific, we don't think all of it will be recoverable" - Citi
** ORG up 13.3% this year, as of last close
Reporting by Roushni Nair in Bengaluru
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