When i first saw the news, my first impression was, SHIT. Solar farm very low return leh on capital. However, i never really look into details but just general overview. The impressive part of the annoucement is that JAKS is 1 of a handful of companies that were awarded a 50MW LSS which is the biggest farm this round. So, i had spent some time and asked google god "how much 50 mw solar farm can make" https://www.ysgsolar.com/blog/how-much-money-can-solar-farm-make-ysg-solar https://greencoast.org/solar-farm-land-requirements/ So, what i read is that 1 MW requires 4 to 5 acres of land and 1 acre of solar farm can generate profit of USD21,250 - 42,500. If i use the lower figure USD21,250 x 4 x 50 = USD4,250,000. That's RM16M. Also, the lowest bid price was 17.68sen/kwh which is higher than the USA that i read at around 12sen/kwh. As a businessman, if source of funds not an issue, i wouldn't mind invest in solar farm if my return is higher than my source of loan. The source of funds should come from bank loans with current low interest rate. Actually i have looked at plantation as a business option too and decided the return was low at 5-10% return a year? I could be wrong as it's just a general overview. However, the beauty of RE just same as plantation, power generation and plantation companies generate some of the most profit in KLSE. You see, in many businesses, profit growth is not guaranteed by expanding capacities. Plantations and utilities are the rare businesses that do. Of cos, if it's a GLC then it's different stories. Hopefully some expert can feedback on typical IRR of solar farm in Malaysia
If jaks Solar farm is built and forget (sold , no maintanence, type ).should have some profit margin Most Solar farm are paid with maintanence based on Output....usually first 5yrs earning money, next 15yrs no underwear to wear. Reason is simple, bidder used the lowest quality to win Bid.
Sorry. I am unable to advise since i am an amateur investor myself. However, based on news link above, i was pretty accurate in profit forecast. 6-8% return is decent for stable income stream. For a company such as JAKS, the valuation used should be DCF (discounted cash flow). What's that? I don't know details and i don't know how to derive it. Just know name. My advise to you, understand WHY you buy certain shares and how to derive basic values from it. If you rely on your financial future on someone else telling you buy or sell, you bound to cry one day. Would it give you more confident if i tell you RM10? I won't tell you if i sell (at least i won't come here and say it's overpriced) I actually trading sold above 0.80 and now bought back, with additional shares. There are big sellers recently in JAKS. I don't know why. I am waiting for QR for an indicator.
Hui_k_c Sifu Windy can i buy this stock now. pls advise 15/03/2021 4:54 PM
OskH jv with Marubeni Corp(Japanese) to bid for LSS2 in 2020 and failed bcos their price is 2X more expensive. Marubeni is the World Largest Solar farm Manager in Saudi & Dubai, they know long term Costing. I have feeling most Solar farm will kaput and takeover by Gov later. OskH is much smarter now, they finance Solar Land instead (someone said)...little Risk
haha. I know Marubeni. I am referring to 5 years make money 15 years losses? By your logic, if i were OSK i won't finance solar land too. If solar farm lose money the owner won't be able to pay loan or rent too right? Or probably you are like your nickname, Sin Gor
This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
WilburR2
869 posts
Posted by WilburR2 > 2021-03-14 12:00 | Report Abuse
JAKS ROCKS lol