Kenanga Research expects a strong flow of job opportunities for Solarvest in the near term.
PETALING JAYA: Solarvest Holdings Bhd
is set for a robust second half of its financial year ending March 31, 2025 (2H25), supported by a record order book of RM961mil, which positions the company for growth.
Despite posting core net profit of RM17mil for 1H25, or about 38% of analysts’ full-year estimates, research houses remain optimistic about Solarvest’s earnings trajectory, citing the potential ramp-up in construction.
Phillip Capital Research noted that the company’s 1H25 core net profit accounted for 35% of its estimates, but this was “broadly within expectations” as it expected the robust order book to drive stronger 2H25 earnings.
“We deem this broadly in line with expectations, as 2H25 will likely see a stronger ramp-up in construction recognition from the the goverment’s Corporate Green Power Programme (CGPP) projects,” the research house said.
Similarly, Hong Leong Investment Bank Research (HLIB Research) pointed out the back-loaded nature of Solarvest’s financial year 2025 (FY25) performance.
“As we have highlighted, FY25 is likely a back-loaded year given the ramp-up period for CGPP engineering, procurement, construction, and commissioning (EPCC) projects and positive seasonality effect in the fourth quarter,” it said.
Kenanga Research, on the other hand, deemed Solarvest’s 1H25 results within expectations in anticipation of a stronger 2H25, to be boosted by the CGPP’s tight completion deadline by end-2025.
Meanwhile, Phillip Capital Research said Solarvest’s RM961mil order book, with 70% comprising CGPP projects, represented cover of two times revenue.
“We remain positive about Solarvest’s order book replenishment prospects, driven by the government’s utility-scale solar programme, including the upcoming fifth phase of the Large Scale Solar programme of two gigawatts,” it noted.
HLIB Research pointed out that since July 2024, Solarvest’s EPCC order book has doubled, hitting a new all-time high of RM961mil.
“This trend could continue. The company could surpass the RM1bil mark by end-2024 with additional contributions from commercial and industrial and CGPP jobs,” HLIB Research said.
Kenanga Research, meanwhile, expects a strong flow of job opportunities for Solarvest in the near term, driven by 800 megawatts (MW) worth of CGPP work with an end-2025 completion deadline and an additional 500MW quota under the Net Energy Metering initiative.
“We expect Solarvest to stand a strong chance of securing at least 30% or about RM720mil of the total photovoltaic system EPCC jobs under the CGPP, which we estimate to be worth around RM2.4bil,” the research house said.
Both Phillip Capital Research and HLIB Research have maintained their “buy” calls on Solarvest, with an unchanged target price of RM2 a share.
Kenanga Research, meanwhile, reiterated its “outperform” rating on the stock but has a target price of RM1.91 per share.
