YTL Corp Bhd plans to pay RM1 billion in dividends per annum for the financial year 2024 and 2025, translating into dividend per share (DPS) of 9.5 sen and yield of 10% per annum.

The target was shared by the top management of the Malaysian-based company in a meeting with a group of select investors in Singapore, according to CGS-CIMB Research in a report released yesterday.

YTL believes the current government will return to business and accelerate project flows post the state elections and thinks the group has a key role to play, according to the report.

CGS-CIMB Research recently hosted a roadshow where YTL Corp executive chairman Tan Sri Francis Yeoh Sock Ping and director in the executive chairman’s office Lucius Chong met a group of investors in Singapore.

It said that YTL reiterated fiscal discipline to keep its cash level at US$3 billion at any point for strategic acquisitions.

It also reported that YTL said it could unlock value over the next few years by paring down stakes in assets such as YTL PowerSeraya Pte Ltd and Wessex Water Services Ltd via a possible listing as investors continue to discount its RM72 billion asset base as at FY22.

On this, YTL provided a caveat that there needs to be stability in the cyclical cement and construction businesses with key projects such as Mass Rapid Transit Line 3 (MRT3) and Kuala Lumpur–Singapore high-speed rail (HSR) rolled out.

At the meeting, YTL team was also reported to have said that core assets, such as Malayan Cement Bhd, including the Vietnam venture, core land bank in Sentul of 165 acres, Power Seraya and Wessex Water are not for sale.

Peripheral assets will be disposed of, with the most recent being land in Perak, which will bring in cash of RM70 million, it said.

In the report, CGS-CIMB also addressed the question as to why YTL was engaging the investment community now.

“YTL believes the current government will return to business and accelerate project flows post the state elections and thinks the group has a key role to play. It also wants to groom the next generation, which will eventually be more involved in the business,” it said.

CGS-CIMB has reiterated its ‘Add’ rating for the counter with a 52-week target price of RM1.28. It ended yesterday’s trade at 95.5 sen.

The stock, which has been hovering between 54 sen and 68 sen in the last two years, began surging May 17 when it closed at 75 sen, up 8.5 sen from the day when it closed at 66.5 sen. Close to 130.59 million shares exchanged hands on that day, its largest single day trade since December 2020. – TMR