KUALA LUMPUR (Aug 26): Shares of PETRONAS Dagangan Bhd (KL:PETDAG) rose on Wednesday after the fuel retailer reported better-than-expected second-quarter results, driven mainly by stronger-than-expected earnings from its commercial segment.
The counter rose as much as 58 sen or 2.9% to RM20.58, before paring some gains to close at RM20.52 — still up 52 sen or 2.6% — with a market capitalisation of RM20.39 billion. Over 900,000 shares were traded.
The group’s core net profit rose 47.4% year-on-year to RM402.2 million in the second quarter ended June 30, 2026 (2QFY2026), lifting first-half FY2026 core earnings by 19.2% to RM676.5 million.
This accounted for 63% of CIMB Securities’ full-year earnings forecast, which the research house deemed above expectations.
CIMB raised its FY2026 earnings forecast by 5.1% to reflect the stronger-than-expected commercial segment performance, while increasing its target price to RM20.50 from RM19.40 previously. It maintained its 'hold' call on the stock.
However, CIMB does not expect the strong commercial segment margins seen in 2QFY2026 to persist, as jet fuel prices have gradually increased.
“Jet fuel prices have gradually increased during 3Q2026, which could reverse the timing benefit and lead to weaker commercial margins,” CIMB said in a note to clients.
Nevertheless, domestic fuel demand should remain supported by household spending, tourism activity and targeted fuel subsidies, it said.
Similarly, TA Securities and Hong Leong Investment Bank (HLIB) expect commercial margins to moderate in the second half of the year, as Brent crude prices rise towards US$90 per barrel, reversing the earlier price-lag gains.
“Commercial segment margins may normalise in 2HFY2026 following the strong 2QFY2026 performance, as the sharp decline in MOPS (Mean of Platts Singapore) prices generated favourable price-lag gains,” TA Securities said.
“Given that profitability remains sensitive to product-price movements, the exceptional 2QFY2026 margin uplift may not be repeated if prices trend higher,” it said, adding that PETRONAS Dagangan’s integrated PETRONAS supply chain and diversified earnings base should provide resilience.
TA Securities raised its FY2026-FY2028 earnings forecasts by 1.4%, 2.6% and 3.7% respectively, on higher sales volume assumptions for both the retail and commercial segments. It also raised its target price to RM20.80 per share from RM20.30 previously.
However, given the stock’s strong share price performance in recent months, TA Securities downgraded its recommendation to 'hold' from 'buy'. HLIB, meanwhile, maintained its 'buy' rating and unchanged target price of RM21.34.