Update shared on 15 Dec 2025
Fair value Decreased 1.67%Narrative Update on Tenaga Nasional Berhad
Analysts have modestly trimmed their price target on Tenaga Nasional Berhad by about RM0.27. This reflects slightly lower revenue growth assumptions that are only partly offset by improved profit margin expectations and a marginally reduced future P/E multiple.
What's in the News
- Tenaga Nasional Berhad received additional tax assessment notices totaling approximately MYR 1.39 billion for the 2020 and 2021 assessment years from the Inland Revenue Board of Malaysia, prompting a series of legal and regulatory responses by the company (Key Developments).
- On 18 September 2025, the High Court acknowledged TNB's Notices of Discontinuance, formally recording the company’s decision to withdraw its Judicial Review application challenging the additional tax assessments (Key Developments).
- Following the withdrawal of the Judicial Review, TNB submitted a separate application to claim incentives under Schedule 7B of the Income Tax Act 1967, aligning its position with a precedent set by a Federal Court decision (Key Developments).
Valuation Changes
- Fair Value: Reduced slightly from MYR 15.95 to MYR 15.69, reflecting a modest downgrade in the intrinsic value estimate.
- Discount Rate: Edged down marginally from 9.23 percent to 9.23 percent, indicating almost no change in the perceived risk profile.
- Revenue Growth: Lowered from 4.15 percent to 3.49 percent, implying a moderate reduction in long term top line growth expectations.
- Net Profit Margin: Increased from 7.25 percent to 8.15 percent, signaling a meaningful improvement in anticipated profitability.
- Future P/E: Cut from 23.07x to 20.57x, suggesting a moderate derating of the multiple investors are expected to pay for future earnings.
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