KUALA LUMPUR: CIMB Research is maintaining an Add call on YTL Power International with a target price of RM2.39.
The research house said the recommendation has been maintained despite earnings for the company’s third quarter ended March 31 having come in below consensus expectations because there may be more opportunities for YTL Power to bid for power plants, given recent news flow suggesting fast-tracking of new generation capacity.
It said among the new generation capacity, Track 4A has been granted by the Government via direct negotiations.
“We believe YTL Power is the likely winner for Track 4A given its previous experience with gas power plants as Track 4A is rumoured to be a 1,400MW gas power plant,” it added.
It has also adjusted the earnings forecasts for the financial year ending June 30 2014 to 2016 by 11.5% to 12.8% after taking into consideration Power Seraya’s lower margins.