Stock Name: PETGAS
Company Name: PETRONAS GAS BHD
Research House: HWANGDBS
Company Name: PETRONAS GAS BHD
Research House: HWANGDBS
Petronas Gas Bhd (PetGas) will be transformed into a multi-utility player upon completion of its Melaka regasification plant next year and the Kimanis power plant in 2013, says HwangDBS Vickers Research Sdn Bhd.
Peninsular Gas Utilisation (PGU) gas supply will increase by up to 20 per cent after completion of the Melaka regasification plant, it said in its research note today.
HwangDBS has maintained a "buy" call on PetGas. The key catalysts are the signing of a Regasification Service Agreement (RSA) and Power Purchase Agreement (PPA).
As expected, it said PetGas declared a final net dividend per share (DPS) of 35 per cent, bringing the financial year 2011 net DPS to 50 sen or a net yield of 4.5 per cent.
PetGas registered a strong financial year 2011 net cash of RM2.3 billion.
"We expect capex to rise from RM700 million in financial year 2011 to RM1.5 billion per annum over financial years 2012-2013 with new investments in regas and power plants," HwangDBS said.
Despite the rising capex, free cash flow will remain strong at less than RM600 million, due to improved profitability under the fourth Gas Processing and Transmission Agreement (GPTA), it added.
PetGas does not have a dividend policy.
The financial year 2011 net payout works out to be 69 per cent and HwangDBS has assumed a 66-68 per cent net payout for financial year 2011-12 with sustainable 4.5 per cent yield. - Bernama
Peninsular Gas Utilisation (PGU) gas supply will increase by up to 20 per cent after completion of the Melaka regasification plant, it said in its research note today.
HwangDBS has maintained a "buy" call on PetGas. The key catalysts are the signing of a Regasification Service Agreement (RSA) and Power Purchase Agreement (PPA).
As expected, it said PetGas declared a final net dividend per share (DPS) of 35 per cent, bringing the financial year 2011 net DPS to 50 sen or a net yield of 4.5 per cent.
PetGas registered a strong financial year 2011 net cash of RM2.3 billion.
"We expect capex to rise from RM700 million in financial year 2011 to RM1.5 billion per annum over financial years 2012-2013 with new investments in regas and power plants," HwangDBS said.
Despite the rising capex, free cash flow will remain strong at less than RM600 million, due to improved profitability under the fourth Gas Processing and Transmission Agreement (GPTA), it added.
PetGas does not have a dividend policy.
The financial year 2011 net payout works out to be 69 per cent and HwangDBS has assumed a 66-68 per cent net payout for financial year 2011-12 with sustainable 4.5 per cent yield. - Bernama
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