Brazil mandated sharp reduction in electricity rates for both consumers and businesses. See no mention of similar tariff cuts for water / sewage. Could be a good entry point but markets rightly hate any government intervention.
Interesting information, but I don't think that is the explanation. I read a Reuters article on the electricity rate cuts and it said these cuts are solely because the government is lowering taxes on electricity to try to boost demand. Makes sense that there is no mention of something similar for water/sewage because reduced rates wouldn't really boost demand.
"markets rightly hate any government intervention" - in this case the market seems to be saying it hates tax cuts. Too, if the market hated government intervention was the rationale for SBS's drop, the market wouldn't have pushed up the price of 51%-state-owned SBS in the first place.
Quite a drop! Maybe: no need to invest in emerging market utilities with inflation-linked revenues if Germany's high court decision means Europe won't collapse? Maybe: a snapback reversal of the huge divergence this year between SBS and the Brazilian market (EWZ)?