Malakoff recovery clouded by tax hit; analysts split on outlook
KUALA LUMPUR: Malakoff Corp Bhd’s earnings recovery is gaining traction following improved plant operations, but analysts remain divided on the outlook as higher taxes and non-recurring gains cloud its underlying performance.
Malakoff Corp Bhd's earnings recovery is gaining traction, but analysts remain divided on the outlook. Higher taxes and non-recurring gains are clouding the company's underlying performance. RHB Research analyst Max Koh cut Malakoff's financial year 2026 earnings estimates by 45 per cent due to an increased effective tax rate (ETR) of 40 per cent, compared to 19 per cent previously.
The ETR for FY26 was attributed to non-tax-deductible expenses related to its sukuk. However, Malakoff's operational recovery remains on track, particularly with the Prai power plant performing above expectations. Koh expects earnings from the Tanjung Bin Power Plant to improve in the second half of FY26 following the resumption of rotor operations.
PublicInvest, on the other hand, remains cautious and retains its "Underperform" call on the power producer, citing the need for stable plant availability and recurring earnings.
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