IOI Properties To Gain From MRT2
IOI Properties Group may emerge as the key beneficiary for the mass rapid transit Sungai Buloh-Serdang-Putrajaya line (MRT2), given that it has 200 hectares of landbank in Putrajaya, that houses IOI Resort City.
According to RHB Research, the new MRT line will likely further increase the gross development value for the group’s landbank in Putrajaya and expects IOI City Mall to be a valuable asset.
Checks by the research house revealed that Phase 2 of the IOI City Mall, which will be constructed at a later stage could be at a close proximity to the proposed Universiti Tenaga Nasional MRT, noting that the IOI City Mall will likely see long-term value appreciation if the plan materialises.
Significance: RHB Research has maintained its ‘Buy’ rating on the firm, with a target price at RM3.38, at a 30 percent discount to its revalued net asset valuation (RNAV), stating a possible appreciation in value for IOI City Mall could spur a RNAV re-rating for the group.
CIMB Lowers Target Price Of Perisai Petroleum
Management of Perisai Petroleum Teknologi has shared that mobile offshore production unit Rubicone and pipelay barge Enterprise 3 (E3) are unlikely to be put to work this year, given that the monsoon season has started in Southeast Asia.
However, CIMB Equities Research noted that the uptrend in contributions from Perisai Pacific 101 and Perisai Kamelia should soften the blow caused by the idleness of Rubicone and E3. Meanwhile, the research house lowered its FY14 to FY15 earnings per share to reflect further downtime for Rubicone and E3.
On a separate note, management has started negotiations with potential clients for jack-up Perisai Pacific 102, which is scheduled for delivery in April and May 2015.
Significance: CIMB Research has maintained its ‘Add’ rating for the firm, with a lower target price of RM2.20. The research house anticipates that FY15 and FY16 earnings will be substantially stronger as all assets will be fully deployed then, given the strong demand for jack-ups in Southeast Asia.
TNB’s Earnings Boosted By Lower Coal Prices
For the fourth quarter ended 31 August, Tenaga Nasional (TNB) posted a 46.1 percent jump in net profit to RM1.4 billion, on higher sales and forex gains. Revenue for the quarter rose 23.4 percent to RM11.7 billion.
The surge in last quarter earnings lifted full-year net profit to RM6.5 billion, as the company benefited from cheaper coal prices and higher electricity tariff. Cheaper coal prices helped TNB save RM220 million in FY14.
While the group did not provide any price projection for coal, sharp declines in fuels prices in the global market is likely to translate into bigger savings for TNB, at least during the first quarter FY15.
Significance: TNB has proposed a final dividend of RM0.19 and projects electricity demand growth to be in line with projected economic growth of 5 percent to 6 percent in FY15. - Shares Investment
