Tenaga Nasional's Renewable Projects Likely to Support Long-Term Growth

Dow Jones10:07

0207 GMT - Tenaga Nasional's renewable energy initiatives will likely strengthen its long-term growth outlook, supported by the Tasik Kenyir hybrid hydro floating solar project and Sungai Perak hydro life extension program, CIMB Securities analyst Choong Chen Foong says in a note. The Kenyir project is expected to generate a high single-digit equity return based on a 21-year renewable energy supply agreement with DayOne, he notes. The 5.8 billion ringgit Sungai Perak project will extend the hydro plant's operating life by 40 years under a new power purchase agreement, he says. While the projects are expected to have minimal impact on 2026-2028 core EPS, both look positive from an ESG perspective, he adds. CIMB maintains a buy rating on Tenaga and keeps target price at 15.90 ringgit. Shares are 0.6% higher at 12.98 ringgit.

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