Mar 4 2017, 12:20 PM
If u look at fundamental, the figure is one of the consideration, then u look at business model and industry.
Tenaga is the sole distributor of electricity in Malaysia, i doubt other Company would get this license. Water and electricity can do harm to our national security so i think government would like to have control on it.
Nestle is very establish in term of logistic and marketing. The brand of Maggi, Milo etc is deep down to each Malaysian. Other company will find hard to beat Nestle tbh. The business is so constant and paying dividend generously, which is why PE is so high.
Tenaga has to spend on constant amount on Capex while Nestle don't have to, all this cash has to re-spend to make sure its electricity distributing is stable. Nestle doesn't have to spend so much on capex, just factory and machine one off, then maintain it will do. Btw this is 2 different company in different industry, is quite hard to compare apple with apple.
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