Petronas Gas Bhd advanced on Tuesday, June 21

Petronas Gas rises at mid-morning

By Surin Murugiah of theedgemalaysia.com

KUALA LUMPUR: Shares of Petronas Gas Bhd advanced on Tuesday, June 21 in early trade as investors picked up the stocks in line with a positive outlook by analysts.

It rose eight sen to RM12.98 with 83,100 shares done.

OSK Research raised its target price to RM14, adding the share price had rallied by some 11.4% since it highlighted in its last report the vast growth potential for the company.

The research house was upbeat on the outlook for the upcoming second and third liquified natural gas (LNG) regasification terminals in Pengerang and Sabah, just as it is working on its first plant in Melaka.

“The LNG plants will not only lead to more gas transportation, processing and fixed reservation revenue, but the capex incurred should also drive down Petronas Gas’ tax rate to below 20%.

“Factoring in the lower tax rate, our forecasts are raised by 3% to 7%, while our discounted cashflow-derived fair value rises to RM14.00. We noted during our recent European marketing trip that interest in the counter was quite strong,” it said.

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