ENI has a clear precedent for hybrid issuance: it first issued perpetual subordinated hybrids in 2020, added further hybrids in 2021, and paid hybrid coupons in 2022. That recent use is a strong positive signal that hybrids are an accepted capital-structure tool for the group. However, the appropriate extent over the next 18 months should be calibrated against its very strong 2022 credit position and the higher 2022 rate environment.

Key considerations:

- **Existing hybrid starting point:** ENI already has hybrids outstanding. The equity statement indicates net issues of perpetual subordinated bonds of about **€3.0bn in 2020** and **€2.0bn in 2021**, with coupon payments in 2021 and 2022. This suggests roughly **€5bn of hybrid principal** already embedded in equity, before issuance costs and coupons.  
- **Total adjusted capital base:** At year-end 2022, reported equity was **€55.23bn**. Reported borrowings and lease liabilities were approximately **€31.87bn**: short-term borrowings €4.45bn, current long-term borrowings €3.10bn, current lease liabilities €0.88bn, long-term borrowings €19.37bn, and noncurrent lease liabilities €4.07bn. This gives a broad capital base around **€87bn** before more detailed S&P adjustments. A €5bn hybrid stock is already around **5%-6%** of this broad capital base, or roughly **half of the 15% S&P equity-credit cap**.
- **Credit metrics are strong and improving:** S&P net debt/EBITDA for 2022 was only **0.95x**, while S&P FFO/net debt was **65.9%**, both very strong for an integrated oil and gas issuer. Moody’s adjusted leverage trend is also **improving**. This does not suggest meaningful rating pressure that would require aggressive hybrid issuance.
- **Cash generation is robust:** Operating cash flow was **€17.46bn** in 2022, comfortably above investing cash outflow of **€7.02bn**. Even after dividends, buybacks, lease payments, and debt repayments, the company ended with higher cash. Cash and cash equivalents rose to about **€10.16bn**, and current financial assets at FVTPL were another **€8.25bn**, indicating substantial liquidity.
- **Funding needs exist but are not urgent:** ENI is capital intensive, with 2022 PPE capex of **€7.7bn**, plus acquisition and investment spending. It also repaid more noncurrent borrowings than it raised in 2022. Still, the balance sheet and cash flows show capacity to fund investment without needing maximum hybrid support.
- **Market cost has deteriorated:** Euro swap rates rose sharply in 2022, and subordinated/nonfinancial IG spreads widened. New hybrid issuance would likely be materially more expensive than the 2020-2021 issuance environment. This argues against issuing up to the full 15% cap unless rating preservation or large M&A/capex pressure requires it.
- **Sector risk is cyclical:** As an integrated oil and gas company, ENI faces commodity-price volatility, energy-transition capex, and potential acquisition/decarbonization investment needs. Hybrids can provide useful rating flexibility, but current leverage headroom is ample.

Overall, ENI should not be advised to go to the S&P maximum of 15%, nor to 11.25%, because there is no evidence of significant leverage stress, material downgrade risk, or a transformational funding requirement. A 0% recommendation would also be too low because ENI has an established hybrid program and hybrids remain useful for capital-structure flexibility in a cyclical, capital-intensive sector. Given the existing roughly €5bn hybrid base and the €3bn maximum annual issuance constraint, a moderate target around **7.5% of total adjusted capital** is the most balanced recommendation: it recognizes ENI’s recent hybrid issuance pattern and the value of maintaining rating flexibility, while avoiding excessive issuance in a higher-cost market.

<answer>7.5%</answer>