Bursa Picks | Solar Segment Overview
M+ Global Updates 02/04/2024 15:57

The Corporate Green Power Programme (CGPP) is poised to be a significant driver of job opportunities and a boost to order books in the renewable energy (RE) sector, with an estimated value of contracts ranging between RM2.7-3.0bn.

The fifth large-scale solar (LSS) programme, featuring a quota of up to 2GW with a special category for floating solar farms of 500MW has been created. This may create up to RM7bn worth of solar EPCC jobs.

Meanwhile, we have observed a rising number of companies within the private sector adopting green energy systems as part of their commitment to ESG principles in line with the launch of Bursa's ESG reporting platform.

Besides, the government has introduced the NETR masterplan last year and the RE target is increased from 40% to 70% by 2050. This will be a strong booster for the renewable energy and solar segment going forward.

SLVEST ($SLVEST 0215.MY$ ): Results have improved strongly from FY23 of RM19.8m to RM24.5m in 9M24, hence if we annualised the earnings, it will be RM32m, which is a growth of 61% in net income. Overall, we believe there are some upside as they are trading at 32x PE as compared to its 2Y average PE of 40x.

SAMAIDEN ($SAMAIDEN 0223.MY$ ): The group has recorded RM6.1m in 6M24, and trading at 49x trailing 12M PE. If we annualised the earnings of the recent 2Q24, that will translate to a 20% expected growth as compared to FY23 net income of RM10.1m. Although it is on the high side of valuation, we believe they are decently positioned for LSS5 which will be announced by 1H2024.

——— Trading ideas from Loui, M+ Online Head of Research

More about Loui:

Loui Low leads a team of analysts to perform equity and economic research and to provide investment advisory services to the organization's sales team, fund manager and retail fraternity. He has more than 10 years of experience in the stockbroking industry.

He graduated with a Bachelor of Science in Statistics from University of Malaya. He also holds an STA Diploma and is a member of the Society of Technical Analysts (MSTA) United Kingdom.


The content is provided as general information only and should not be taken as investment advice. All the contents shall not be taken as a recommendation to buy or sell any security or financial instruments. Any action you take resulting from information, analysis, or commentary on this article is your responsibility. Please consult your investment advisor before making any investments.

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