TLG [OUTPERFORM +15.6%] - Higher valuation for defensive business - Update

- We maintain our OUTPERFORM rating for TLG despite raising our target price (TP) by 15% as the company’s share price has rallied 16% over the past two months.

- We raise our 2023F/24F/25F NPAT by 4%/7%/7%, respectively, as TLG’s revenue has surpassed our expectation — evidenced by 4M 2023 revenue rising 9% YoY. 

- We raise our target P/E multiple on average 2023F-24F EPS from 11x to 12x as we believe TLG’s defensive business can command a higher valuation. This is evidenced by the stock’s outperformance vs the VN-Index so far in 2023.

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