Company Coverage
Tenaga Nasional (TNB MK): 2Q26: In Line; EBITDA Margin 29% On Higher Non-Fuel Opex
BUY (Maintained)
Current price:
Target price:
Upside:
RM14.30
RM16.30
+14.0%
Analyst
Highlights
2Q26 normalised net profit rose 6% yoy to RM1,053m (-16% qoq) on the back of a higher regulatory revenue base. This brings 1H26 normalised net profit to RM2,306m (+5% yoy), in line with expectations.
2Q26 electricity demand surged +8% yoy on the back of a 14% yoy increase in commercial demand from data centres and retail. Peninsular Malaysia’s peak demand hit a new high recently at 22,014MW on 6 Aug 26.
Maintain BUY with a DCF-based target price of RM16.30.
Analysis
2Q26: Results within expectations. Tenaga Nasional (TNB) reported a 2Q26 normalised net profit of RM1,053m (+6% yoy; -16% qoq). The yoy earnings growth was driven by a higher regulatory revenue base but this was partly offset by higher repair & maintenance costs, computer expenses and higher depreciation charges given higher asset base.
First interim dividend. TNB declared its 1H26 interim DPS of 25 sen/share– similar to 1H25. We project a full-year net DPS of 57 sen/share, based on a 70% dividend payout ratio. This translates to a net dividend yield of 4%.
Highlights
2Q26 normalised net profit rose 6% yoy to RM1,053m (-16% qoq) on the back of a higher regulatory revenue base. This brings 1H26 normalised net profit to RM2,306m (+5% yoy), in line with expectations.
2Q26 electricity demand surged +8% yoy on the back of a 14% yoy increase in commercial demand from data centres and retail. Peninsular Malaysia’s peak demand hit a new high recently at 22,014MW on 6 Aug 26.
Maintain BUY with a DCF-based target price of RM16.30.
Analysis
2Q26: Results within expectations. Tenaga Nasional (TNB) reported a 2Q26 normalised net profit of RM1,053m (+6% yoy; -16% qoq). The yoy earnings growth was driven by a higher regulatory revenue base but this was partly offset by higher repair & maintenance costs, computer expenses and higher depreciation charges given higher asset base.
First interim dividend. TNB declared its 1H26 interim DPS of 25 sen/share– similar to 1H25. We project a full-year net DPS of 57 sen/share, based on a 70% dividend payout ratio. This translates to a net dividend yield of 4%.
BUY (Maintained)
Current price:
Target price:
Upside:
RM14.30
RM16.30
+14.0%
Analyst
IMPORTANT NOTICE - DISCLOSURES AND DISCLAIMERS
This report is provided subject to, and must be read together with, the full Disclosures / Disclaimers available at this link, which are incorporated by reference into this report. In particular, this report is intended for general circulation and informational purposes only and does not constitute personal investment advice or a recommendation to buy or sell any investment product or security. You should independently evaluate the information and, where necessary, seek advice from a qualified financial adviser regarding the suitability of any investment. Analyst certifications required under applicable regulations, including SEC Regulation AC (where relevant), are included in this report. By accessing, receiving or using this report, you acknowledge that you have read, understood and agreed to be bound by the Disclosures / Disclaimers, as may be amended, supplemented or updated from time to time.
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