This article first appeared in Capital, The Edge Malaysia Weekly on September 7, 2026 - September 13, 2026

Target price: RM16.50 BUY

RHB RESEARCH (SEPT 1): Demand from data centres (DCs) remains robust as Tenaga Nasional Bhd (KL:TENAGA) signed new agreements to supply 856-megawatt (mw) capacity during the first-half ended June 30, 2026 (1H26).

For 1H26, Tenaga signed five new energy supply agreements (ESA) with DCs for a total of 856mw capacity. Enquiries from DCs remain robust as management is targeting to sign 10 ESAs of up to 1.5-gigawatt (gw) capacity this year. To date, Tenaga has signed up 8.4gw of ESAs and completed 1.1gw capacity (+26% q-o-q). Overall, management is hopeful to sign another 5gw of ESAs over the next few years.

To this end, Tenaga had increased its FY26 electricity sales growth forecast to 5% to 6% (versus 4.5% to 5.5% earlier). Note: Electricity sales grew 8% for the 1H26 period. We believe approvals for upcoming DCs will be more stringent with the government requiring DCs to: (i) secure customers; (ii) have a renewable energy (RE) mix; and (iii) commit to 10-year ESA tenures — to get projects approved.

For 1H26, Tenaga utilised RM5.6 billion capital expenditure (capex). While this makes up only 43% of our RM13 billion forecast, capex utilisation typically accelerates towards the end of the year. Projects earmarked for investment include the 500kV main intake substation in Sedenak West, Johor, and the 500km 500kV backbone transmission line from Paka to Kulai. Management is still hopeful of achieving two-thirds of Regulatory Period 4 capex approvals, which should provide a 7% uplift to our FY26F EPS and target price (TP).

Tenaga has submitted a bid for the NEWGEN26 tender to build new gas plants by 2029-2031. The tender was closed in July and we expect the winners to be announced by year-end. According to a report, Tenaga had submitted a bid to build a 700mw gas plant at Connaught Bridge in Klang, Selangor. Assuming Tenaga wins the tender, we estimate a 2% upside to our TP.

We make no change to our FY26-27F EPS. Our TP (including a 4% ESG discount) is pegged to 19 times FY26F PER, or at +1SD from the stock’s three-year mean. We believe the premium is justified as Tenaga is the prime beneficiary of the National Energy Transition Roadmap, with the regulated framework providing a stable earnings base. 

Target price: RM1.69 BUY

TA SECURITIES (AUG 28): Heading into 2H26, we expect Duopharma Biotech Bhd’s (KL:DPHARMA) government sector sales to remain soft, weighed by seasonal factors and slower-than-expected offtake amid potential delays in the disbursement of the Ministry of Health (MOH) procurement budget. The weakness could also partly reflect inventory build-up in 1H26 as the government stocked up to mitigate potential supply disruptions arising from the Middle East conflict. For Budget 2027, we expect little change in the MOH allocation from the current year.

However, stronger private and export demand should partly offset the weaker government contribution. Duopharma’s export sales rose 22.3% y-o-y to RM36.2 million in 1H26, driven by stronger demand from the Philippines, Singapore and the Middle East. We expect momentum to sustain into 2H26, supported by renal products. Meanwhile, private sector sales grew 8.2% y-o-y to RM186.4 million, underpinned by new product launches and broader market coverage. Raw material and packaging supply also remain manageable. We reiterate our “buy” call on Duopharma with an unchanged TP of RM1.69 per share, based on 15 times CY27 EPS.

Target price: RM1.15 BUY

RHB RESEARCH (AUG 28): Wasco Bhd’s (KL:WASCO) 1H26 ended June 30 core earnings fell 48.6% y-o-y to RM23.8 million, coming in below expectations at just 27% of the consensus’ full-year forecasts. The shortfall was mainly due to weaker contributions from its energy services and renewable segments. Revenue declined 29.7% y-o-y to RM487.5 million, dragged by lower energy services (-32.2% y-o-y) and renewables (-6.3% y-o-y). Energy services were affected by deferred project execution amid supply-chain disruptions linked to the Middle East conflict while renewables faced weaker industrial boiler activities and gross margins.

Nevertheless, the order book stood at RM2.5 billion (-3.2% q-o-q), comprising 43% engineering, 48% pipeline and 9% bioenergy. We expect pipeline coating activities to pick up only in 2H26 as several projects remain deferred. Any easing in geopolitical tensions could accelerate deferred energy infrastructure and repair projects, supporting demand for pipeline coating and engineering services.

We cut FY26F, FY27F and FY28F earnings by 53%, 37% and 17% respectively, reflecting weaker near-term execution, slower order book replenishment and delayed investment decisions. Consequently, we lower our TP to RM1.15 from RM1.37, based on 11 times FY27F PER, in line with its five-year mean.

Target price: RM2.94 BUY

APEX SECURITIES (Sept 1): We view the financial year ending June 30, 2027 (FY27) as an inflection year for Inari Amertron Bhd (KL:INARI), with core net profit expected to rebound 37.9% y-o-y after a 26.3% decline in FY26. The turnaround should be driven by its Datacom/Photonics pivot as capacity expansion transitions into revenue contribution, supported by around RM300 million of capex plus RM150 million for buildings and facilities across FY27F-FY28F.

We turn bullish on FY27F-FY29F, driven by three key developments: a front-loaded Datacom/Photonics capacity build-out; execution ahead of guidance, with 1QFY27F radio frequency utilisation at 85% versus 77% guided and further growth optionality from advanced packaging; a new transimpedance amplifier (TIA) customer; and the power/system-on-module (SoM) pilot line.

We raise FY27F, FY28F and FY29F core net profit forecasts by 21.3%, 37.2% and 49.9% to RM258.7 million, RM298.1 million and RM339.6 million respectively. We upgrade Inari to “buy” from “hold”, with a higher TP of RM2.94 (from RM2.11), based on an unchanged 37.7 times PER applied to a rolled-forward FY28F EPS of 7.8 sen.

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