KUALA LUMPUR (May 29): Petronas Gas Bhd’s (PetGas) shares rose in early trade after the company reported first-quarter results ended March 31, 2019.

At 10.06 am, its shares accumulated 10 sen to RM16.44, with 37,100 shares changed hands.

PetGas net profit rose to RM515.46 million in its first quarter against RM483.22 million a year earlier due to unrealised foreign exchange (forex) gain and a higher share of profit from a joint-venture company. 

Meanwhile, revenue for the quarter rose to RM1.37 billion from RM1.35 billion in the previous year's corresponding period.

Kenanga Investment Bank has maintained market perform on the counter with a revised target price of RM16.55.

“Share price has fallen 10 per cent in the past three months which is now closer to our target price and we believe all negatives should have been priced in by now,” it said.

Meanwhile, Affin Hwang Capital reiterated a “Hold” calls on the stock despite management’s guidance that tariffs will be largely similar.

Petronas Gas had submitted the Regulatory Period 1 (RP1) proposal to the Energy Commission on April 19 and guided that tariffs for the gas transportation and regasification services in 2020 would likely be similar to those in the pilot regulatory period in 2019.

The final outcome is expected to be announced in the fourth quarter of this year.

“We are taking a more conservative approach and cut our target price to RM17 from RM17.30.