Key Indices
Top Stories
Sector Update | Renewable Energy
- Backdropped by haze, rising heat and high oil & gas prices, the government is pivoting to RE, incentivising players with the introduction of a CRESS Acceleration Package. SAC is lowered to 14 sen/kwh and project IRRs rise to 10-12%. This bankable move by the government is a key re-rating catalyst for the sector and we expect a slew of CRESS contract wins in the next three months. Maintain OVERWEIGHT. Top picks: Solarvest, Pekat Group and Northern Solar.
Company Update | Northern Solar (NORTHERN MK/BUY/RM0.69/Target: RM1.00)
- Northern Solar may be close to capturing a sizeable RM800m CRESS project, lifting its orderbook by 4x to RM1b – a substantial enhancement to both earnings and orderbook visibility in the near future. We like the stock for its undemanding valuation and three-year earnings CAGR of 51% (FY26-29). The group is currently working on a main board listing transfer and Shariah status reinstatement by end-26. Maintain BUY with a target price of RM1.00, based on 11x FY28F EPS.
Company Update | Tenaga Nasional (TNB MK/HOLD/RM13.04/Target: RM14.60)
- Contrary to our expectation, Tenaga announced that the group will absorb the RM120m-150m impact from the electricity tariff fuel surcharge exemption for the period Sep-Dec 26. This is negative for Tenaga as this decision is now an overhang on Tenaga’s near-term share price performance – given rising regulatory interference and uncertainty over whether this will be a one-off. Downgrade Tenaga to HOLD with a lowered DCF-fair value of RM14.60.
Market Spotlight
- The FBMKLCI declined 9.18pt last Friday to close at 1,665.56 dragged down by selling pressure on index-linked counters.
- US stocks were mixed after the close on Friday, as gains in the technology, industrials and telecommunicaitons sectors led shares higher while losses in the utilities, basic materials and consumer goods sectors led shares lower.
Tehnical Analysis
FBMKLCI, FCPO & FKLI Index Outlook
Traders’ Corner
Cape EMS | CEB MK
- Trading Buy Range: RM0.25-0.275
Farm Fresh | FFB MK
- Trading Buy Range: RM2.08-2.09
Hi Mobility | HI MK
- Trading Buy Range: RM1.86-1.89
Top Stories
Sector Update | Renewable Energy
- Backdropped by haze, rising heat and high oil & gas prices, the government is pivoting to RE, incentivising players with the introduction of a CRESS Acceleration Package. SAC is lowered to 14 sen/kwh and project IRRs rise to 10-12%. This bankable move by the government is a key re-rating catalyst for the sector and we expect a slew of CRESS contract wins in the next three months. Maintain OVERWEIGHT. Top picks: Solarvest, Pekat Group and Northern Solar.
Company Update | Northern Solar (NORTHERN MK/BUY/RM0.69/Target: RM1.00)
- Northern Solar may be close to capturing a sizeable RM800m CRESS project, lifting its orderbook by 4x to RM1b – a substantial enhancement to both earnings and orderbook visibility in the near future. We like the stock for its undemanding valuation and three-year earnings CAGR of 51% (FY26-29). The group is currently working on a main board listing transfer and Shariah status reinstatement by end-26. Maintain BUY with a target price of RM1.00, based on 11x FY28F EPS.
Company Update | Tenaga Nasional (TNB MK/HOLD/RM13.04/Target: RM14.60)
- Contrary to our expectation, Tenaga announced that the group will absorb the RM120m-150m impact from the electricity tariff fuel surcharge exemption for the period Sep-Dec 26. This is negative for Tenaga as this decision is now an overhang on Tenaga’s near-term share price performance – given rising regulatory interference and uncertainty over whether this will be a one-off. Downgrade Tenaga to HOLD with a lowered DCF-fair value of RM14.60.
Market Spotlight
- The FBMKLCI declined 9.18pt last Friday to close at 1,665.56 dragged down by selling pressure on index-linked counters.
- US stocks were mixed after the close on Friday, as gains in the technology, industrials and telecommunicaitons sectors led shares higher while losses in the utilities, basic materials and consumer goods sectors led shares lower.
Tehnical Analysis
FBMKLCI, FCPO & FKLI Index Outlook
Traders’ Corner
Cape EMS | CEB MK
- Trading Buy Range: RM0.25-0.275
Farm Fresh | FFB MK
- Trading Buy Range: RM2.08-2.09
Hi Mobility | HI MK
- Trading Buy Range: RM1.86-1.89
Key Indices
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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.
