Tenaga Nasional

Tenaga Nasional

Postby winston » Tue May 31, 2011 2:19 pm

Not vested

Tenaga Nasional: Near-term outlook brightens considerably( RM6.58 / PT: RM8.0 ) by Daniel Raats; Ivan Lee; Akshat Agarwal

Action: Upgrade to BUY with a revised PT of RM8.0/share

While our preliminary understanding of Malaysia’s proposed fuel cost pass-through mechanism does not completely soothe concerns over the structural obstacles faced by the business, Monday’s +2% base tariff increase among a 28% increase of regulated natural gas prices and more than-commensurate 7.1% increase in average electricity tariffs does, in our view, markedly improve TNB’s return profile over FY12/13F.

A 13.9% upward revision of our FY12F normalised EPS estimates underpins a like revision to our PER-derived PT to YR8.0/share; we upgrade to BUY.


Source: Nomura
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Ichimoku Kinkou Hyou (Itchy Mushrooms)

Postby GeraldFx » Tue Aug 16, 2011 5:37 pm

TENAGA. Weak bearish outlook.

$5.52 - Weekly S
$5.7 - Monthly S

Wait till market breaks $6 for a better bullish confirmation.
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Re: Tenaga Nasional

Postby winston » Thu Jul 03, 2014 5:16 pm

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Tenaga Nasional (Share price: RM12.18, TP: RM13.30)

Attractively priced big cap in Malaysia with potential upside from the tariff review

Outlook remains promising with rising energy demand and capacity growth

Key catalysts: Capacity growth and successful implementation of incentive-based regulation (IBR)
framework.

Maintain BUY rating with TP of RM13.30

Source: DBS
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Re: Tenaga Nasional

Postby winston » Thu Jan 08, 2015 5:44 am

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Lower fuel prices means RM310mil savings for TNB

PETALING JAYA: Tenaga Nasional Bhd (TNB) will enjoy a lower fuel cost mix this year from the higher generation of coal and the lower generation from gas and liquefied natural gas and other alternatives, including oil and distillates.

Hong Leong Investment Bank (HLIB) Research said this was in line with the increasing power generation from coal-fired power plants, given the operation recovery of both the Tanjung Bin 2,100MW and Jimah 2,100MW plants, as well as the operation commencement of the TNB-owned Janamanjung 41,000MW coal-fired power plant in April.

“We estimate TNB to enjoy net fuel cost savings of RM310mil in the first half of this year and RM703mil (in 2015), provided the piped gas price stays at RM15.20/million metric British thermal units on the next tariff review,” the research house said in a statement yesterday.

It said as the Government was committed to implementing the incentive-based regulation (IBR) this year after the recent current tariff structure announcement, the IBR platform would provide earnings and cashflow certainties to TNB.

“TNB’s cost under-recovery last year of RM848mil will be compensated by the Government, indicating the latter’s commitment to protecting TNB’s interest,” it noted.

Additionally, it said the expected listing of independent power producer (IPP) players like Malakoff Corp Bhd and 1Malaysia Development Bhd by the second quarter of this year would excite the market, providing wider investment choices in the nation’s defensive power industry.

Technically, it said with TNB being the only investment player in the industry and YTL Power International Bhd likely to be out when its two power plants expire in September, there was a potential price-to-earnings ratio re-rating for the industry with the listing of the IPP players.

However, it noted that downside risks had to be considered, especially with the ringgit depreciating against the US dollar (currently at RM3.50 to the dollar), partly offsetting the lower US-dollar denominated coal price.

“Based on TNB’s financial year 2014 (FY14) operations, it may incur an incremental cost of RM417.5mil (RM382.1mil from coal costs and RM35mil from the interest on US-dollar denominated borrowings),” it said, adding that other downside risks include a surge in global energy prices (natural gas and coal) and supply disruption of energy resources.

HLIB Research forecast TNB’s FY15-FY17 earnings to increase by 1.7% to 2.5%, with YTL Power remaining unchanged.

It maintains a “buy” recommendation on TNB, with a higher target price (TP) of RM16 based on a discounted cash flow estimate, while retaining its “hold” call on YTL Power, with an unchanged sum-of-parts-based TP of RM1.44.

TNB’s share price closed at RM13.76, down eight sen.

Its 52-week high was on Nov 26 last year, where it had surged to RM14.52, while its 52-week low was RM11 on Jan 27 last year.

Source: The Star
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Re: Tenaga Nasional

Postby winston » Fri Jan 23, 2015 4:56 am

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TNB Q1 net profit up 34.4% to RM2.352bil

KUALA LUMPUR: Tenaga Nasional Bhd’s net profit for the first quarter ended Nov 30, 2014, rose 34.4% to RM2.352bil from RM1.75bil a year ago, thanks to the increase in tariff and sales in the Peninsula and Sabah.

Sales in the Peninsula grew 3.3%, while in Sabah it was 2.4%, which was an additional boost to TNB given the tariff hike in January 2014 of 14.9% and 16.9% respectively.

Revenue in the quarter was up 15.2% to RM11.027bil from RM9.572bil previously.

Earnings per share climbed to 41.67 sen from 31.01 sen.

Source: The Star
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Re: Tenaga Nasional

Postby winston » Fri Dec 06, 2019 8:13 am

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‘TNB sell-down overdone’

KUALA LUMPUR: Kenanga Investment Bank Research views the recent sell-down of Tenaga Nasional Bhd over a tax dispute as overdone, given that it is not an operational issue.

The research unit said at worst, the total dispute claims of up to RM6bil could wipe out an entire financial year’s earnings but TNB may not lose the case.

Under the Incentive Based Regulation (IBR) framework with fuel cost past through via imbalance cost pass-through (ICPT), TNB’s earnings are expected to be stable with a regulated return of 7.3%.

This also offers dividend certainty of about 4% based on 50% payout.

“As such, the recent sell-down provide further buying opportunity into this heavyweight index-linked stock. Thus, we upgrade the stock to outperform from market perform with an unchanged target price of RM14.30 which is based on three-year moving average of 14 times FY20 PER, ” it said in its latest report.

Risks to its new recommendation are sharp decline in regulated return rates under new RP3, from 7.3% currently, as well as a sudden surge in fuel prices resulting in short-term earnings weakness.

Last Friday, TNB faced a heavy sell-down after it was slapped with RM3.98bil additional tax assessment by the Inland Revenue Board for 2015-2017. This is the second additional tax assessment after the still unsettled RM2.1bil claim which was announced back in November 2015.

The tax dispute was related to reinvestment allowance up to 2018. As such, TNB may face another dispute claim for 2018 that could amount to RM1bil more.

TNB’s share close up 38 sen to RM13.40 pushing the FBM KLCI 3.82 points higher yesterday.

Kenanga Research said the ICPT surcharge is set to be reduced in 1HCY20 given the fall in fuel prices but this is earnings-neutral as the savings would be passed through to consumer with a six-month lag.

“A RM4bil tax dispute last week resulted in a sell-down which aggravated its already weak share price trend.

“This could be a good buying opportunity as the market has overreacted to the tax issue which is a non-operational issue, in our view.

“Besides, TNB may also win the case. Thus, we upgrade the stock to outperform with unchanged target price of RM14.30, ” it said.

The research house also pointed out that on Tuesday, in the minister’s question time at the Dewan Rakyat, the Energy Minister said that while domestic customers are not affected by the ICPT surcharge which would be funded by Kumpulan Wang Industri Elekrik (KWIE) amounting to RM62.95mil, the non-domestic customers would enjoy a surcharge reduction of 0.55 sen/kWh to 2.00 sen/kWh in 1HCY20 from 2.55 sen/kWh in 2HCY19.

This ICPT surcharge is on top of base tariff of 39.45 sen/kWh.

So far, the Energy Commission and TNB have not made an announcement for the new tariff structure.

“The reduction in ICPT surcharge is not unexpected given the declining trend of fuel costs, ” it said.

In 3QFY19, average coal cost for TNB fell to RM301.90/mt against RM356.80/mt in 1HFY19 while average LNG cost also dropped to RM32.75/mmbtu as opposed to RM36.16/mmbtu in 1HFY19.

Both fuel prices have fallen below the reference prices of RM315.90/mt for coal and RM35.00/mmbtu for LNG to use for the formulation of base tariff of 39.45 sen/kWh for Regulatory Period (RP) 2 between 2018 and 2020.

Should fuel prices continue to trend lower, there may be a lower base tariff in RP3 over 2020-2022.

Source: The Star

https://www.thestar.com.my/business/bus ... D3Af80I.99
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Re: Tenaga Nasional

Postby winston » Tue Nov 03, 2020 10:44 am

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HLIB Institutional Research has a BUY rating on Tenaga with TP RM12.50 (+30% upside).

We believe values re-emerge after tumbling 21.6% YTD despite facing potential selling pressures from foreigners (~14%) amid domestic headwinds.

Overall, we like Tenaga for its relative earnings stability and is a proxy to Malaysia’s economic recovery in FY21F coupled with a recurring dividend yield of 5-6%.

Tenaga is currently trading at an undemanding FY21F PE of 11.3x (vs 10Y historical mean 30x) and 1x P/B (29% lower than 10Y mean 1.4x).

Technically, Tenaga is steeply oversold (based on daily, weekly and monthly charts) after plunging 25% from YTD high of RM12.83.

We expect limited downside risks with key supports at RM9.10-9.30 zones.

A decisive breakout above RM9.90 (10D SMA) to RM10.20 (30D SMA) overhead resistances will spur prices towards our LT objective of RM10.86 (100D SMA).

Cut loss at RM9.05.

Source: HLIB
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Re: Tenaga Nasional

Postby winston » Tue Dec 08, 2020 8:49 am

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Tenaga Nasional — Resilient business model with decent dividend yield

Business model remains resilient with a decent dividend yield

Chart-wise, share price has pulled back from RM11.80, thus present level could be a good entry opportunity for recovery theme stock

Source: The Edge
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Re: Tenaga Nasional

Postby winston » Thu Jan 07, 2021 9:35 am

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Tenaga Nasional (TNB MK)

Share Price: MYR10.42
Target Price: MYR12.90

Recommendation: Buy

A value play

With generation being largely stable in 4Q20, we believe there is little risk of revenue disappointment.

Tenaga’s continued over-recovery of generation cost in 2020 (low coal price) has resulted in a tariff rebate being introduced for 1H21, thus relieving the pressure for further tariff discounts.

Reiterate BUY with an unchanged MYR12.90 TP (DCF-based).

Source: Maybank

https://factsetpdf.maybank-ke.com/PDF/2 ... c93dbd.pdf
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Re: Tenaga Nasional

Postby winston » Thu Jan 14, 2021 8:51 am

Tenaga Nasional (TNB MK)
Latest Tax Development Lifts An Overhang But Curtails Lofty Special Dividend


The stock offers good earnings visibility as the government approves a gap year for
TNB.

Separately, TNB and IRB reached an agreement to lower the disputed amount for
2013-18 by RM2.44b.

In return, TNB made a cash payment of RM1.76b to IRB, booked as tax recoverable in the event the court rules in favour of TNB.

While this lifts an overhang for TNB, the cash outflow diminishes the likelihood of a 4Q20 special dividend.

Maintain BUY. Target price: RM13.70.

Source: UOBKH

https://research.uobkayhian.com/content ... 715c08590e
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