KUALA LUMPUR (Dec 13): Tenaga Nasional Bhd rose as much as 30 sen or 2% after the state-owned utility revised its dividend payout to between 30% and 50% of its core net profit.
Shares of Tenaga rose to their highest so far today at RM14.28. At 11:16am, the stock was traded at RM14.10, for a market capitalisation of RM79.66 billion.
Tenaga, which was Bursa Malaysia's 10th-largest gainer, saw some two million shares traded.
Last Friday, Tenaga told Bursa Malaysia that its dividend payout would be based on net profit attributable to shareholders after minority interest, excluding extraordinary and non-recurring items.
Tenaga said the revised dividend policy would take effect from current financial year ending Aug 31, 2017 (FY17).
Today, CIMB Investment Bank Bhd said Tenaga's revised dividend payout at between 30% and 50% was below CIMB's expectation at 60%.
At between 30% and 50%, CIMB analyst Saw Xiao Jun said Tenaga's FY17 dividend yield could rise to between 3% and 5% from 2.4%.
"We cut FY17–19F EPS by 0.4–1.4% to reflect the new dividend policy. This lowers our TP (target price) to RM16.80, still based on 12.5x CY18 P/E, its five-year mean. We expect consensus to raise Tenaga's dividend yield forecasts to reflect the new dividend policy, which could cause Tenaga's share price to re-rate in the near term.
"Looking beyond this, we think Tenaga's disclosures about its operations and acquisitions would be the next important share price catalyst. We believe the market still underappreciates Tenaga's earnings growth potential due to its complex structure," he said.