COMPANY UPDATE
Consensus set to be disappointed Shariah-compliant
Tenaga's 4Q result to be released Thurs, Oct 28. We think the full-year net profit ex-forex items will be 10-20% below consensus, which is not fully factoring in the usual 4Q spike in other costs and rising coal prices. The proposed subsidy rationalisation and feed-in tariffs bode poorly for reinstatement of the tariff formula. We see Tenaga being pushed back in the queue again, leaving it exposed to coal price fluctuations. Sell.
Consensus set to be disappointed Shariah-compliant
Tenaga's 4Q result to be released Thurs, Oct 28. We think the full-year net profit ex-forex items will be 10-20% below consensus, which is not fully factoring in the usual 4Q spike in other costs and rising coal prices. The proposed subsidy rationalisation and feed-in tariffs bode poorly for reinstatement of the tariff formula. We see Tenaga being pushed back in the queue again, leaving it exposed to coal price fluctuations. Sell.
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