SAMAIDEN: Major Solar Project Win Bolsters Orderbook, Analyst Maintains Buy Recommendation

Samaiden Group Berhad has announced a significant new achievement, securing the rights to develop a 100MWac ground-mounted solar plant under the LSS5+ bidding cycle. This strategic win is set to substantially boost the company’s orderbook and strengthen its future earnings potential, leading TA Securities to reiterate its “BUY” recommendation for the stock.

Project Details and Strategic Impact

The newly awarded project, located in Segamat, Johor, has a capacity of 100MWac and is slated for commercial operation by October 31, 2027. It will operate under a 21-year solar Power Purchase Agreement (PPA), with Samaiden controlling a majority stake in the consortium undertaking the development. This marks Samaiden’s second-largest solar asset win, significantly expanding its renewable energy portfolio.

With this latest addition, Samaiden’s total gross power generation capacity in its pipeline now stands at 263MW. These assets are expected to come online gradually over the next three years, providing a substantial uplift to the company’s recurring income base. TA Securities estimates that this project alone could contribute an average annual earnings enhancement of RM4.5 million, representing a 14% increase against FY27F earnings, driven by an estimated capital expenditure of RM280 million and a project internal rate of return (PIRR) of 7%.

Outlook and Valuation

Beyond the direct project contribution, this LSS5+ award also significantly underpins orderbook replenishment prospects for Samaiden’s core Engineering, Procurement, Construction, and Commissioning (EPCC) segment. The group has already secured EPCC jobs for 132.6MWac capacity with an aggregate contract value of RM436 million, bringing its total orderbook to a record high of RM699 million, which is approximately two times its record FY25 revenue. The firm is targeting to maintain a 10% EPCC share for both LSS5 and LSS5+ projects, which collectively represent RM12 billion to RM14 billion in potential EPCC opportunities over the next two years.

TA Securities maintains its earnings projection and Sum-of-Parts (SOP)-based target price of RM1.47 per share, pending further details on Samaiden’s exact stake in the LSS5+ project. Assuming a 70% stake, the firm projects a net value accretion of RM80 million (RM0.14 per share), enhancing the SOP valuation by 10%. The robust orderbook, strong net cash position, and growing pipeline of renewable energy assets position Samaiden as a key beneficiary of the sector’s upcycle, underpinned by a strong three-year earnings CAGR of 28% up to FY28F.

Risks and Catalysts

Key catalysts for the stock include further LSS5 and LSS5+ EPCC contract awards, CRESS/CREAM EPCC contracts, and additional power generation asset wins. However, potential risks include a sharp rise in raw material costs, particularly for solar modules, and delays in project implementation. Despite these risks, the overall outlook remains positive, with TA Securities reaffirming its “BUY” rating.