New Zealand shares rose as Chorus gained to a four-week high on speculation it won't need to ask investors for more capital to fund its fibre network build, and Telecom Corp led the index higher, after tumbling after an analyst put a sell rating on the company.
The NZX 50 Index rose 9.437 points, or 0.2 percent, to 5167.989. Within the index, 24 stocks rose, 17 fell and nine were unchanged. Turnover was $197.5 million.
Chorus, the network provider, advanced 2 percent to $1.75. Earlier this month, Chorus cut a deal with Crown Fibre Holdings, the government body overseeing the ultra-fast broadband network rollout, to bring forward funding of $178 million and also gained more wiggle room under its banking covenants, allowing for weaker earnings relative to its borrowings. Today its case opened in the Court of Appeal, where it is continuing to challenge regulated cut to prices it can charge for network access.
"The other things Chorus has done, by recent deals with Crown Fibre Holdings and its banks, have really taken the risk of an equity raising off the table in the short to medium term," said Matthew Goodson, managing director at Salt Funds Management.
"People are looking ahead for when the draft finding on the final pricing principle for the network are out," he said, referring to the appeal.