KUALA LUMPUR (May 26): CIMB IB Research has maintained its “Add” rating on YTL Power International Bhd (YTLP) at RM1.52 with a lower target price of RM1.80 (from RM1.85) and said YTLP’s 9MFY17 core net profit was a tad below expectations, at 69% of house full-year forecast and 64% of Bloomberg consensus’.
In a note yesterday, the research house said no dividend was declared, as expected.
It said the earnings underperformance was mainly due to weaker-than-expect Wessex Water earnings and investment income.
“We cut FY17F EPS by 9% to reflect the weak 9M17 earnings but raise FY18-19F to account for the commencement of its Paka power plant operations in Sep 2017.
“We cut our SOP-based target price to RM1.80 for lower valuation for Wessex Water. YTLP remains an Add with potential earnings growth in FY18 as a re-rating catalyst,” it said.