KUALA LUMPUR (April 24): Solarvest Holdings Bhd (KL:SLVEST) rose to its highest in three months after securing its largest contract since listing while analysts continued to recommend the stock.
The latest win for a solar plant project in Perak brings Solarvest’s order book to a record level of RM2.7 billion, enough to provide income to the company over the next three years, according to Hong Leong Investment and Phillip Capital.
“Structural catalysts remain intact” thanks to various government programmes, Hong Leong Investment said. “Meanwhile, easing module prices should remain supportive of margins.”
Shares of Solarvest rose as much as 16 sen or nearly 6% to RM2.93, its highest since January 22. The stock has rebounded from its March lows following the outbreak of the Iran war, but is still down about 11% year to date.
Still, Solarvest enjoys a near-unanimous consensus, with 10 ‘buy’ recommendations out of 11 research houses. AmInvestment is the sole ‘hold’ call, and the stock does not have any ‘sell’ rating. The average target price is RM3.33 based on target prices of the 11 analysts tracked by Bloomberg.
The RM1.1 billion contract announced on Thursday would be Solarvest’s first contract for the financial year ending March 2027 (FY2027), generating about RM90 million in profit before tax until completion, Phillip Capital said.
Further, Solarvest is also the asset owner for the project with annual recurring profit after tax of RM4 million over the 21-year power purchase agreement, according to Phillip Capital’s estimates.
Solarvest secured an engineering, procurement, construction and commissioning contract to develop a 470-megawatt solar plant and interconnection facility under the additional round of the fifth large-scale solar (LSS5+) programme.
The project, scheduled for completion by February 2028, would be Solarvest's single largest contract awarded to date and ranks among the largest utility-scale solar plants in Southeast Asia.