PETALING JAYA: CIMB Research views Solarvest Holdings Bhd
as a key beneficiary of Malaysia’s renewable energy (RE) push.
In an initiation of coverage report, the research house highlighted the clean energy solutions provider’s sizeable order book of RM2.37bil.
It expects potential new wins from the sixth phase of Malaysia’s Large Scale Solar programme (LSS6) and Corporate Renewable Energy Supply Scheme (Cress), alongside rising recurring income from solar generation, to drive a 37.7% three-year compound annual growth rate in the group’s core net profit from financial year 2026 (FY26) to FY29.
“There is a strong earnings visibility, and based on the 2.65 gigawatts of solar photovoltaic (PV) capacity on offer, we estimate RM10bil worth of engineering, procurement, construction and commissioning (EPCC) contracts are up for grabs.
“Assuming a 15% market share, we forecast Solarvest to secure RM1.8bil in new contracts,” CIMB Research wrote in the report.
The group has completed over one gigawatt-peak (GWp) of solar PV projects across utility-scale and rooftop installations, with cumulative capacity expected to exceed 3.5GWp upon completion of LSS5+ projects.
In addition to that, Solarvest’s partnership with Brookfield Asset Management will strengthen its competitiveness under Cress through access to global capital, operational expertise, and an extensive corporate offtaker network.
“We factor in RM900mil and RM300mil of Cress-related EPCC wins in FY27 and FY28, respectively,” CIMB Research said.
The research house added Solarvest’s EPCC order book could see upside if the company exceeds the assumed 400 megawatt (MW)-peak of Cress wins for FY27 to FY28, against its 300MW to 500MW target.
The forecast had not yet factored in potential wins from LSS7, which could be introduced in 2027.
CIMB Research has set a sum-of-parts based target price of RM4.65 a share for the stock.
“Trading at 26.1 times 2027 price-to-earnings ratio, Solarvest is priced in line with solar PV peers.
“We believe the group deserves a valuation premium given its superior earnings growth prospects and proven execution track record.”
According to the research house, there is an additional upside of 37 sen per share to Solarvest’s target price for its solar assets, assuming the company maintains a 5% market share across the next five LSS programmes (LSS7 to LSS11).
It noted that downside risks include sharp fluctuations in solar panel prices, project execution delays, and changes in government policies.
