KUALA LUMPUR (Feb 26): Shares of Pekat Group Bhd (KL:PEKAT) rose to a new record high on Wednesday, as investors cheered the solar panel installation company’s quarterly results and contract win.

Core net profit for 2024 came in about 18% above the consensus’ estimates, prompting at least three of the four analysts covering Pekat to raise their estimates and target prices. The stock only has “buy” calls following Apex Securities’ upgrade on Wednesday.

“The group’s prospects remain bright moving forward, backed by its strong order book,” said MIDF Amanah Investment Bank. The research house raised its target to RM1.51, as low solar panel costs may boost margins from engineering, procurement, construction and commissioning (EPCC) jobs.

Pekat climbed 4% or five sen to RM1.22, its highest since its listing nearly four years ago. The stock eased off high and was last trading at RM1.21, after more than 1.5 million shares changed hands. At its last price, Pekat has a market capitalisation of about RM779 million.

Shares of Pekat, which also provides earthing and lightning protection solutions, have gained 22% since the year began, thanks to contract wins, as well as newsflow on data centres and Malaysia’s renewable energy initiatives. The company now has jobs worth RM590.9 million on hand.

“We believe these factors present strong potential for EPCC jobs flow, contributing to Pekat’s growth trajectory with a strong focus on the solar field,” Apex Securities said.

The house is also optimistic about the newly acquired EPE Switchgear Sdn Bhd, adding that the power distribution unit is set to benefit from the upgrade and replacement cycles at Tenaga Nasional Bhd (KL:TENAGA) that occur every eight- to ten years.

Pekat also defied Tuesday’s broad market selldown on Bursa Malaysia, as the company reported record earnings for 2024. 

Net profit surged 66% to RM22.76 million, while revenue was up 28% to RM291.09 million. The company also later announced that EPE Switchgear won a RM97 million contract from Tenaga.

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