KUALA LUMPUR, May 30 ― Tenaga Nasional Bhd's share price fell by more than two per cent in the early trade on Tuesday due to mild profit-taking, in sync with the not-so-rosy market performance.

At 10.55am, the counter eased by 23.0 sen or 2.17 per cent to RM9.52 from RM9.75 at the close yesterday, with about one million shares traded.

Yesterday, TNB reported that its net profit surged 12.2 per cent to RM1 billion in the first quarter (1Q) ended March 31, 2023, from RM893.10 million in the same quarter last year.

The increase was primarily attributed to lower tax provisions recognised during the quarter under review, resulting from the higher utilisation of the reinvestment allowance incentive.

Revenue, meanwhile, rose by 3.9 per cent to RM12.63 billion from RM12.15 billion previously, mainly due to higher sales of electricity.

In a note today, Public Investment Bank Bhd said it remains upbeat on the group’s works, especially on the regional grid interconnection with multiple neighbouring countries following the government’s move to lift the ban on cross-border renewable energy (RE) sales.

"We make no changes on our earnings forecast for now,” it said.

For financial year 2023 (FY2023), it forecasts TNB's net profit to rise to RM4.53 billion from RM3.46 billion in FY2022, while revenue is expected to decrease to RM50.33 billion from RM50.87 billion.

Overall, Public Investment Bank retained its 'outperform' call on TNB with an unchanged discounted cash flow (DCF)-derived target price of RM12.42, on the back of stable electricity demand and its potential as a regional RE hub. ― Bernama