Friday, October 21, 2011

Tenaga slips, worries mount on gas shortage

KUALA LUMPUR: Shares of Tenaga Nasional fell on Friday, Oct 21 on worries about an early resolution to its gas supply shortage which could push it deeper into the red in the fourth quarter ended Aug 31, 2011.

Tenaga fell eight sen to RM5.47 with 445,400 shares done.'' The FBM KLCI lost 1.99 points to 1,439.19. Turnover was 542.78 million shares valued at Rm347.91 million.

RHB Research Institute maintained its Underperform recommendation with unchanged indicative fair value of RM4.74 based on unchanged target CY12 PER of 12 times.

'Due to ongoing gas shortage from maintenance at Petronas' LNG plants and delays for the Bekok C bypass, Tenaga will likely record a loss in 4Q, possibly close to that seen in 3Q (-RM460 million),' it said.

The research house said this was a result of Tenaga receiving only an average of 950 mmscfd of gas in 4Q, just marginally higher than the average 940 mmscfd received in 3Q.

'Whether Tenaga meets our FY11 earnings forecast of RM708 million (consensus: RM750 million), mainly depends on the full extent of unscheduled maintenance by Petronas in 4Q,' it said.

Tenaga reported a core net profit of RM801 million for 9MFY11. The initial guidance from Petronas was 17 days of scheduled maintenance.

'Recall in 3Q, Tenaga incurred an additional RM1.3 billion in fuel costs, due to 61 days of gas supply disruption (of which 51 days were due to unscheduled maintenance),' it said.

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