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NewsHLIB Research sees further electricity tariff cut in 2H15
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HLIB Research sees further electricity tariff cut in 2H15
by Cals Thu 12 Feb 2015, 19:11
HLIB Research sees further electricity tariff cut in 2H15
By TheEdge Markets.com / theedgemarkets.com | February 12, 2015 : 8:32 AM MYT
KUALA LUMPUR (Feb 12): [size=14]Hong Leong IB Research has maintained its “Buy” rating on Tenaga Nasional Bhd ([You must be registered and logged in to see this image.]Financial Dashboard) with a lower target price of RM17 (from RM17.50) and said it remained positive on Tenaga’s long-term earnings growth after the announcement of a tariff cut.
In a note today, the research house said the government had announced tariff cut in Peninsular Malaysia by an average 2.25sen/kWh from March 1 to June 1, while Sabah and Labuan by 1.20sen/kWh, in order to pass back RM727m savings in cost over-recovery in 2014.
HLIB said it was surprised by the announcement of cost over-recovery of RM727 million versus previous guidance of cost under-recovery of RM824 million.
“We see further tariff cut in 2H15, given the expected adjustment in LNG price by Petronas.
“We have assumed lower average tariff and cut FY15-17 earnings by 2.2-7.9%.
“Remained positive on Tenaga’s long-term earnings growth. Maintained BUY with lower target price of RM17.00 (from RM17.50) based on DCFE,” it said.
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By TheEdge Markets.com / theedgemarkets.com | February 12, 2015 : 8:32 AM MYT
KUALA LUMPUR (Feb 12): [size=14]Hong Leong IB Research has maintained its “Buy” rating on Tenaga Nasional Bhd ([You must be registered and logged in to see this image.]Financial Dashboard) with a lower target price of RM17 (from RM17.50) and said it remained positive on Tenaga’s long-term earnings growth after the announcement of a tariff cut.
In a note today, the research house said the government had announced tariff cut in Peninsular Malaysia by an average 2.25sen/kWh from March 1 to June 1, while Sabah and Labuan by 1.20sen/kWh, in order to pass back RM727m savings in cost over-recovery in 2014.
HLIB said it was surprised by the announcement of cost over-recovery of RM727 million versus previous guidance of cost under-recovery of RM824 million.
“We see further tariff cut in 2H15, given the expected adjustment in LNG price by Petronas.
“We have assumed lower average tariff and cut FY15-17 earnings by 2.2-7.9%.
“Remained positive on Tenaga’s long-term earnings growth. Maintained BUY with lower target price of RM17.00 (from RM17.50) based on DCFE,” it said.
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