TNB poised to record RM1.4b Q4 net

KUALA LUMPUR: Tenaga Nasional Bhd (TNB) is expected to
record a core net profit of RM1.4 billion for its fourth fiscal quarter ended Aug 31 2012.

AmResearch said the net profit is poised to expand 20 per cent, if compared month-on-month, mainly due to an estimated 13 per cent decrease in coal costs to around US$90/tonne, and four per cent improvement in natural gas supply to 1,000 million metric standard cubic feet per day (mmscfd) from 960 mmscfd in the third
quarter of fiscal year 2012.

“Note that we have not incorporated any one-off provisions from the RM113 million legal claim for warehousing losses by Irham Niaga in our forecasts.

“We continue to like Tenaga as the upcoming new power plant capacities and tariff restructuring policies will support the stock’s re-rating cycle,” the firm said in a research note, today.

AmResearch added that the recently-announced levelised tariff of 34.7 sen/KWh (assuming natural gas price at RM44/million metric British thermal units) for TNB’s 1,070MegaWatt combined-cycle Prai power plant is a transformative precursor for future power purchase agreements (PPA).

“Assuming natural gas price remains at RM13.70/mmbtu, we estimate that Prai’s electricity tariff could be around 16 sen/KWh, which is 43 per cent below Genting Sanyen’s current rate of 28 sen/KWh,” the research house said.

TNB secured the tender to build and own the new Prai Combined Cycle Gas Turbine (CCGT) plant last week.

Meanwhile, AmResearch also reiterated its “buy” call on TNB, with an unchanged fair value of RM8.15 per share. — BERNAMA