PETALING JAYA: BM Greentech Bhd
is expected to see earnings momentum shift towards the second half (2H) of financial year ending March 31, 2027 (FY27), supported by a ramp-up in battery energy storage system (Bess) deliveries and an improvement in its solar business.
Its bio-energy operations are also expected to remain the main earnings engine over the next two to three years, underpinned by opportunities from Malaysia’s renewable energy programmes.
RHB Research said bio-energy remained a multi-year growth catalyst, with potential engineering, procurement, construction and commissioning (EPCC) opportunities from the 130MW feed-in tariff 2.0 (FiT 2.0) programme. The research house maintained its “buy” call on BM Greentech with a target price of RM2.05.
“Bio-energy remains a multi-year growth catalyst. This is underpinned by potential EPCC opportunities from the 130MW FiT 2.0 programme, where BM Green has an estimated 60%-70% market share among domestic boiler EPCC players,” RHB Research said in a note following BM Greentech’s recent briefing.
With construction taking up to 30 months, the programme is expected to support earnings growth over the next two to three years.
RHB Research estimated that the addressable market could reach RM1bil to RM2bil during the period, giving BM Greentech scope to benefit from its strong position among domestic boiler EPCC players.
The bio-energy business is also supported by BM Greentech’s installed base of about 875 boilers and its established market position in Malaysia and Indonesia, according to Phillip Capital Research.
“Bioenergy remains the key driver,” Phillip Capital said in agreement, adding that management continued to identify the segment as the group’s main cashflow generator.
Meanwhile, Phillip Capital sees Bess as an important near-term catalyst, following the deployment of BM Greentech’s first commercial-scale system in March 2026.
Deliveries are expected to accelerate from the third quarter (3Q) of FY27, with Bess potentially contributing about one-third of solar revenue in FY27 and around 50% in FY28.
“We came away from BM Green’s briefing reassured on its growth prospects, with Bess emerging as a key near-term catalyst,” Phillip Capital said.
The research house said adoption among commercial and industrial (C&I) customers was supported by an estimated three to four-year payback period through peak-demand shaving, while savings data from existing customers was helping BM Greentech with further marketing.
“On the Corporate Renewable Energy Supply Scheme (Cress), management noted growing interest following the 30% reduction in the system access charge rate and is actively exploring opportunities as both a developer and asset owner, with power system studies already completed for select sites,” Phillip Capital said.
However, RHB Research cautioned that the tight end-2028 commercial operation date requirement could pose a challenge, given that construction works could take up to 24 months. Any successful Cress agreement could nevertheless become a re-rating catalyst as it is not currently reflected in RHB Research’s base-case assumptions.
For water treatment, it expects the business to normalise in FY27 after exceptional growth in 4Q26, driven by a high-margin data centre Phase 1 project. Progress on Phase 2 could be delayed to FY28.
