KUALA LUMPUR (Feb 13): YTL Power International Bhd and its parent company YTL Corp Bhd were among the most actively traded stocks in Tuesday morning trade, following the announcement that the two stocks will be added to the MSCI Malaysia Index, effective from Feb 29.
At 10.29am, the trading volume of YTL Power shares stood at 13.72 million, followed by YTL Corp at 9.63 million, making them the fifth and sixth most active stocks on the local stock exchange.
However, their share prices declined, with YTL Power dropping eight sen or 1.98% to RM3.97, giving it a market capitalisation of RM32.39 billion, while YTL Corp fell 0.43% or one sen to RM2.31, valuing the group at RM25.46 billion.
YTL Power hit an all-time high of RM4.20 on Jan 30, as investment analysts covering the stock were optimistic about the group’s prospects, on the back of robust earnings from its PowerSeraya division in Singapore and gradual improvements from its UK division, Wessex Water.
YTL Power’s share price has surged by over 54% since the beginning of this year, and by 436% in the past year. The stock is currently trading at a price-earnings ratio (PER) of 12.18 times.
According to Bloomberg data, there are currently five "buy" calls on the counter, with Hong Leong Investment Bank Bhd providing the highest target price (TP) of RM5.15 and MIDF Amanah Investment Bank Bhd offering the lowest at RM2.99.
YTL Power’s optimistic outlook boosted the parent company's share price. Year to date, YTL Corp has gained over 20%, and 305% over the past year. Presently, YTL Corp is trading at a PER of 16.13 times.
Meanwhile, although Dialog Group Bhd was removed from the MSCI index, its share price gained one sen or 0.56% to RM1.81 at the time of writing on Tuesday, translating into a market capitalisation of RM10.16 billion. It saw some 7.8 million shares change hands, making it the 10th active stock on Bursa Malaysia.
According to Bloomberg, there are five "buy" calls and one "hold" on Dialog, with a 12-month average TP of RM2.74.
AmInvestment Bank Bhd in a report on Feb 9 retained its "buy" call on Dialog, with a sum-of-parts derived fair value of RM3.46 a share, implying a PER of 33 times for the financial year ending June 30, 2024 (FY2024), a mild premium to its five-year average of 31 times, and reflects a neutral environmental, social and governance rating of three stars.
“Dialog currently trades at an attractive FY2024 PER of 17.4 times, well below its five-year mean of 31 times. We believe Dialog deserves a premium valuation above peers, given its long-term recurring cash flow-generating businesses, which are further underpinned by potentially substantive expansion in Pengerang petrochemical and storage developments, with a strong balance sheet that has low net gearing levels,” said the research house.