PETALING JAYA: Solarvest Holdings Bhd
’s latest quota win could add an estimated RM300mil worth of engineering, procurement, construction and commissioning (EPCC) works to its existing unbilled order book of RM1.2bil, says Hong Leong Investment Bank (HLIB) Research.
Solarvest, via its 60%-owned joint venture, has signed a 30-year power purchase agreement with Sarawak Energy to develop a 100MW solar plant in Sarawak.
The Mukah large-scale solar (LSS) marks Solarvest’s largest project in Sarawak to date, deepening the company’s presence.
Sarawak has a target to expand installed generation capacity to 10GW by 2030 and 15GW by 2035, from 5.7GW anchored by its existing hydro resources, but with a stated plan to add 1.5GW of solar by 2030.
On the asset development side, HLIB Research gathered that the project’s internal rate of return is comparable to LSS5.
On completion, Solarvest’s stake-adjusted utility-scale solar assets will expand to 490MW peak, lifting potential recurring revenue to RM110mil per annum.
HLIB Research said this is not inclusive of the 1.5GW peak the company intends to pursue under a partnership structure with Brookfield, which it reckoned will leverage on the corporate renewable energy supply scheme or Cress programme.
“These additions are intended to diversify the generation mix and support new demand from industries and data centres, while strengthening Sarawak’s ambition of becoming a regional renewable hub.”
It maintained its “buy” call on the counter with a target price of RM3.50, driven by price-to-earnings multiple of 25 times on its EPCC business and discounted cashflow of its recurring income assets.
