PETALING JAYA: BM Greentech Bhd
is expected to enter a stronger earnings phase in the coming financial year, with analysts pointing to rising contribution from battery energy storage systems (BESS), a firmer water treatment order pipeline and fresh biomass opportunities as key earnings drivers.
Maybank Investment Bank (IB) Research has maintained its “buy” call on the renewable energy solutions provider with an unchanged target price of RM2.18, saying the group’s earnings momentum should improve meaningfully in FY27 as its solar business pivots towards integrated solar-plus-storage offerings.
The research house said BM Greentech’s near-term strategy reflects changing market realities after residential rooftop solar demand softened following the expiry of favourable net energy metering incentives.
“Management guided for stronger earnings momentum in FY27 driven by the solar segment’s pivot toward solar plus BESS solutions, alongside incremental opportunities in the water treatment and bio-energy segments,” it said after an analyst briefing.
Under the revised tariff structure by Tenaga Nasional Bhd (TNB), commercial and industrial consumers are facing higher maximum demand charges, making battery storage increasingly attractive as companies seek to shave peak demand and optimise electricity usage.
Maybank IB research said BM Greentech is repositioning itself to capture that trend by focusing on integrated systems rather than standalone solar installations.
BESS’ effectiveness in mitigating higher maximum demand charges under the revised TNB tariff structure is expected to support stronger project deliveries beginning in the fourth quarter of FY26 and extending into FY27, the report noted.
Beyond solar storage, BM Greentech’s water treatment division is also emerging as a meaningful earnings pillar.
The company remained optimistic that demand for industrial wastewater treatment, palm oil mill effluent treatment and biogas capture systems will continue to expand, while a newer growth avenue has opened up through water solutions for data centres.
The research house also pointed out that BM Greentech had recently completed a river water treatment project worth about RM15mil to RM20mil for a data centre in Johor and is now engaging additional data centre operators for similar systems.
This came as Johor continues to attract hyperscale data centre investments, creating demand for dedicated and reliable alternative water sources.
Maybank IB Research expected the segment to steadily lift recurring earnings visibility over the medium term.
Meanwhile, biomass remained another upside catalyst.
BM Greentech had submitted a bid for an 8MW biomass project under the government’s new feed-in tariff (FiT 2.0) quota, targeting an internal rate of return of 10% to 12%.
The research house said the broader 130MW biomass allocation under FiT 2.0 could generate between RM1.3bil and RM2bil worth of engineering, procurement, construction and commissioning (EPCC) opportunities.
Given BM Greentech’s estimated 30% share of Malaysia’s biomass boiler EPCC market, the research firm said the company is well placed to secure a meaningful portion of those contracts.
