KEY INVESTMENT HIGHLIGHTS

• Shortlisted as successful bidder of LSS5 (Package 3)
• Plant COD scheduled by Oct-27; to enter into 21-year PPA with TNB
• Strong orderbook expansion prospects driven by CGPP, LSS5 and NEM programs
• Maintain BUY with an unchanged TP of RM1.69

Acceptance of LON from ST. Samaiden, through its wholly owned subsidiary Samaiden Sdn Bhd, has been shortlisted as a successful bidder under package 3 (30MW to 500MW) under the Large Scale Solar 5 (LSS5) programme. It had on 23rd December, accepted a letter of notification (LON) from the Energy Commission (ST) to develop a 99.99MW solar PV plant in Pasir Mas, Kelantan.

Details of the LON. The development is scheduled to achieve commercial operation date (COD) by 11th October 2027, after which it is expected to sell electricity generated to the power grid. Samaiden will enter into a solar power purchase agreement (PPA) with Tenaga Nasional Bhd (TNB) for 21 years, which will generate recurring income for the group. We expect Samaiden to undertake the entire EPCC works on its own.

Replenishment prospects. Samaiden's order book remains at a record high of RM521.2m. The group has secured RM91.2m worth of CGPP EPCC contracts and we understand that they are eyeing at least 70MW more of similar EPCC jobs, which translates into a potential RM200m-280m incremental orderbook. Further out, the recently announced 2GW LSS5 and the extension of the Net Energy Metering (NEM) 3.0 programme until 30 June 2025 cements future orderbook replenishment outlook.

Expansion into Indonesia. Recall that the group recently established a 70:30 JV in Indonesia with PT MCS Bina Energi to expand its footprint into Indonesia's RE market. The JV will be involved in both EPCC and investment of assets. They have identified several projects, and some are already in the midst of discussion.

Earnings estimates. We keep our earnings estimates unchanged.

Recommendation. We maintain our SOP-derived TP of RM1.69. We continue to value the group's EPCC business at 26x PER, at a slight discount to industry leader Solarvest. We maintain our BUY call on Samaiden being one of the key beneficiaries of EPCC prospects under the CGPP, LSS5 and the long-term RE growth potential from the National Energy Transition Roadmap. The balance sheet remains strong with a net cash position of RM119.8m, underpinning near-term growth prospects.

Source: MIDF Research - 31 Dec 2024