Thursday, 12 April 2012

RHB Research upgrades utilities sector to Overweight

KUAL A LUMPUR (April 12): RHB Research Institute Sdn Bhd has upgraded the Utilities sector to Overweight from Neutral and said it was turning more positive on Tenaga Naional Bhd given better visibility of its earnings outlook with the improved gas supply.

In a note April 12, the research house said that while imported LNG pricing remained an issue, it believed that the implementation of a dual pricing system wass more likely and therefore have an earnings neutral impact to Tenaga.

“As for YTL Power, the stock lacks catalysts while dividends are no longer attractive. However, sentiment may improve if the 1Bestarinet project helps to monetise its WiMAX network.

“Given our recent upgrade on TNB, we upgrade the sector to Overweight, from neutral,” said RHB Research.

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