| Investment Bank | TA SECURITIES |
|---|---|
| TP (Target Price) | RM2.85 (+39.0%) |
| Last Traded | RM2.05 |
| Recommendation |
A leading company has significantly bolstered its order book with the recent securing of a substantial solar Engineering, Procurement, Construction, and Commissioning (EPCC) contract. This latest development underscores the company’s strategic diversification into the green energy sector and strengthens its long-term growth prospects, leading an investment bank to reiterate its ‘BUY’ recommendation.
Key Contract Details
The company’s consortium, comprising its Green Energy Sdn. Bhd. (51%) and Solarvest Holdings Berhad’s subsidiary, Atlantic Blue Sdn. Bhd. (49%), was awarded solar EPCC contracts by Maya Jaya Sdn. Bhd. These contracts fall under Malaysia’s LSS5 programme and carry a combined value of RM171.7mn, translating to an effective RM87.6mn for the company. The scope involves developing a total of 56.5MWac of solar photovoltaic capacity across three sites in Kuala Langat, Selangor, and Sungai Lalang, Kedah.
Under the collaborative agreement, the company will be responsible for project funding and strategic oversight, while Solarvest will lead the technical execution. The contracts are set to commence on December 15, 2025, with completion and full commissioning targeted for June 26, 2027.
Impact on Order Book and Strategic Direction
This new job win has propelled the company’s FY26 year-to-date new job wins to approximately RM2.1bn, elevating its total outstanding order book to an impressive RM5.2bn. This robust figure represents a solid 3.3x cover of the company’s FY26 revenue forecast. Although current replenishment accounts for 53% of the FY26F new order book replenishment assumption of RM4.0bn, management believes the company remains well on track to achieve the balance within the next month.
Notably, this marks the company’s second solar EPCC-related contract win in FY26, highlighting a continued effort to diversify its revenue base beyond conventional high-rise construction into the fast-growing green energy segment. This maiden collaboration with Solarvest is viewed as a key reference point and springboard for future solar EPCC tenders, enhancing the company’s execution credentials and competitiveness for upcoming LSS6 packages.
Future Outlook and Analyst Recommendation
The positive outlook is further supported by a robust pipeline of potential awards, including an estimated RM2.0bn from recurring clients Exsim and Maxim for high-rise residential developments in Johor, alongside an external residential tender book of about RM500mn.
In light of these developments, TA Securities has reiterated its ‘BUY’ recommendation on the company with an unchanged target price of RM2.85. The investment bank’s positive stance is driven by the company’s long-standing relationships with major clients ensuring steady project flow, its strategic positioning as a key beneficiary of the property and construction upcycle, and its robust earnings visibility and growth prospects, supported by an expanding order book. The job win was within expectations, leading TA Securities to maintain its earnings forecast unchanged for now.
