Stock Name: TENAGA
Company Name: TENAGA NASIONAL BHD
Kenanga Research kept its call on Malaysia's power firm Tenaga Nasional to 'outperform' today on the back of lowered fuel costs and possible tariff revisions after the country's general elections widely expected for this year.
"We are banking on meaningful tariff revisions post general elections, since neither Tenaga nor the government can continue to bear the heavy fuel subsidy burdens," said the broker in a research note on Monday.
Kenanga also said it expects Tenaga's core earnings to surge as much as 138 percent quarter-on-quarter due to better gas supply, lower coal cost, high hydropower usage and manageable demand.
A possible Indonesia export tax on coal is unlikely to affect Tenaga's 2012 full-year earnings guidance as coal prices fall, Kenanga added.
Kenanga kept its target price for Tenaga at RM7.31 per share (US$2.38). Tenaga shares dropped 0.9 per cent to RM6.43. - Reuters
Company Name: TENAGA NASIONAL BHD
| Research House: KENANGA | Price Call: BUY | Target Price: 7.31 |
Kenanga Research kept its call on Malaysia's power firm Tenaga Nasional to 'outperform' today on the back of lowered fuel costs and possible tariff revisions after the country's general elections widely expected for this year.
"We are banking on meaningful tariff revisions post general elections, since neither Tenaga nor the government can continue to bear the heavy fuel subsidy burdens," said the broker in a research note on Monday.
Kenanga also said it expects Tenaga's core earnings to surge as much as 138 percent quarter-on-quarter due to better gas supply, lower coal cost, high hydropower usage and manageable demand.
A possible Indonesia export tax on coal is unlikely to affect Tenaga's 2012 full-year earnings guidance as coal prices fall, Kenanga added.
Kenanga kept its target price for Tenaga at RM7.31 per share (US$2.38). Tenaga shares dropped 0.9 per cent to RM6.43. - Reuters
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