Have you heard the buzz about Mestron Holdings Berhad (MESTRON)?

They've just hit a major milestone, and if you've been thinking about jumping into the renewable energy sector, you'll want to hear this. MESTRON’s subsidiary, Liziz Biogas Sdn Bhd, just got the thumbs up from the Sustainable Energy Development Authority (SEDA) for their biogas plant at Gua Musang. Let's break down why this is huge news and why you might want to consider getting in on the action.

Who Are These Mestron Guys, Anyway?

Originally, MESTRON was all about manufacturing, particularly making specialty poles. But they've branched out into renewable energy, and things are heating up. Last year, they pulled in a net profit of around RM10 million, and that was before diving deep into green energy.

What’s the Big Deal About This FiT Approval?

So, SEDA gave the green light for what's known as a feed-in tariff (FiT) rate for MESTRON's biogas plant. The rate is set at a pretty competitive 39.75 sen/kW, starting from July 26, 2023, and running for a whole 21 years. According to the big boss, Por Teong Eng, this could bump up MESTRON’s yearly income by RM2 to RM3 million. Yep, you read that right.

Why is this Important?

Well, with the new FiT rate, the biogas business could soon make up around 20 to 30% of MESTRON's total income. If you're into sustainable investments, that's music to your ears. Plus, they're also seeing growth in their original manufacturing sector, especially in telecom poles.

What’s Coming Up Next?

MESTRON isn't slowing down. They're planning to ramp up their plant capacity from 2.4MW to 3.2MW in the next 2 to 3 years. And get this—their biogas plant is right next to a palm oil mill. That means they've got a steady supply of raw materials, which is a big win for long-term growth.

Bottom Line

With Malaysia going full throttle on renewable energy (hello, National Energy Council and future energy exchange!), MESTRON is sitting pretty. If you've been looking for a green investment that also promises solid returns, MESTRON is becoming a hot ticket.

So there you have it. Mestron Holdings Berhad is shaping up to be a pretty sweet investment opportunity, especially if you're keen on both sustainability and long-term growth.

Worth a look, don't you think?