KUALA LUMPUR: OSK Investment Research maintained its buy call on Petronas Gas at RM9.88 with an unchanged discounted cash flow-based fair value of RM13.81 and said the company's FY10 results were within its and consensus forecasts despite a quarter-on-quarter (q-o-q) drop in profits given the rather conservative forecasts.

"As the q-o-q dip was due to the timing of its centralised utility facilities clients' maintenance activities as well as a one-off cost item at Gas Malaysia, we are largely maintaining our forecasts.

"We still see profits jumping by more than 37% year-on-year in FY11 on the new Gas Processing and Transmission Agreement terms and also raise our dividend forecast from 65 sen to 70 sen, or a 7.1% yield."

The research house said Petgas remains a good defensive buy given the current market volatility.