PETALING JAYA: The engineering, procurement, construction and commissioning (EPCC) contract secured by Sunview Group Bhd
for a 595MW floating solar photovoltaic plant with a battery energy storage system at Kenyir Lake, Terengganu is a major breakthrough for the company, says TA Research.
The contract is valued at RM1.96bil was awarded to a joint-venture consortium with Sunview’s subsidiary, Fabulous Sunview Sdn Bhd, owning a 40% stake while Cypark Renewable Energy Sdn Bhd will own the majority 60%.
The floating solar farm is expected to be completed in slightly over two years, and is set to be the largest in South-East Asia.
The research said this was a huge win for Sunview and marked the group’s breakthrough into the EPCC of floating solar PV plants.
“That said, we await further details on the required capital injection into the joint-venture which could reflect Sunview’s share of the working capital required to execute this massive project,” it said in a report.
To factor in the potential earnings from the latest contract win, albeit this would be partly offset by higher interest cost, TA Research raised the group’s financial year 2026 (FY26)-FY28 earnings per share by 2% to 42%.
Following this, it has upgraded stock’s call to “hold” from “sell” previously, while the target price was upped to RM0.395, from RM0.29.
TA Research said while the latest project would significantly boosting the group’s order book visibility, it could stretch the balance sheet further.
It noted that Sunview is currently undertaking two solar asset acquisitions worth a combined RM175mil to RM245mil, including additional funding needed to complete one of the assets.
As of the end of the fist quarter financial year 2026 (1Q26), the group had net debt of RM138mil, with net gearing at 137%.
The group completed the first tranche of its private placement following the issuance of 20.7 million placement shares. At an average issue price of 31.75 sen per share, the research house said the exercise would have raised RM6.6mil, which would reduce the group’s net gearing to 123%.
“The remaining placement could raise a further RM11.5mil assuming the same indicative price of 31.75 sen per share, which could further reduce net gearing to an estimated 101%,” TA Research added.
Meanwhile, MBSB Research maintained its “sell” call on the stock, despite being positive on the contract win.
However, it has revised the stock’s target price to RM0.32 (from RM0.30).
“Based on Sunview’s 40% stake in the joint-venture, we expect its share of the contract to be RM784.8mil. With this new win, we estimate that the group’s outstanding order book has risen to RM1.15bil, providing two years of earnings visibility,” said the research house.
It expected future job replenishment to be driven by the large-scale solar 5+ projects, and ongoing rooftop solar segment. However, it said Sunview continues to lag in translating job wins into meaningful and consistent profitability.
This could be a factor as to why the stock traded below some of its larger peers, a trader said, adding that investor sentiment could remain cautious as the company continues to work on translating its project wins into steady profitability.
