Based on below information, I am planning to buy tenaga-cl. I have 10 lots at 0.23 cents. I think maybe I will buy in another 10 lots, maybe 0.16 - 0.18. Waiting and waiting waiting...
Although TNB has underperformed the index after releasing a poor set of 3QFY09 results in July, we expect some selling pressure after the national utility company announces potentially lacklustre 4Q numbers in October. This would, however, present an excellent opportunity to accumulate the shares on weakness. With the potential for a tariff hike in January 2010, we think TNB has gotten cheap enough for us to upgrade the stock to a Buy with our new fair value at RM9.38.
Earnings pared but fair value raised. We are raising our assumption of coal prices in FY10 and tweaking our generation mix forecast, which leads us to cut our net profit forecasts for FY09 by 2% and FY10 by 2.7%. Nonetheless, the possibility of further tariff hikes in the future prompts us to revise upwards our DCF terminal growth rate from 1.5% to 2.2%. Our DCF-based fair value is accordingly raised to RM9.38. We advise investors to accumulate on weakness ahead of a potential tariff hike in January 2010. Upgrade to Buy.