Maybank Investment Bank said the group’s Large Scale Solar 2 (LSS2) projects in Kelantan are expected to obtain its commercial operation date either this month or the next.
PETALING JAYA: Maybank Investment Bank Bhd is maintaining a “hold” call on Cypark Resources Bhd
with a higher target price of 87 sen from 73 sen as it expects an improvement in earnings for the second half of 2025 (2H25).
In a report yesterday, Maybank Investment Bank said the group’s Large Scale Solar 2 (LSS2) projects in Kelantan are expected to obtain its commercial operation date either this month or the next – ensuring the renewable energy (RE) provider will have scheduled and confirmed payments from Tenaga Nasional Bhd for the sale of electricity.
“As for its waste management and waste- to-energy sector (WTE), the plant has resumed operations on Oct 29, 2024, after a period of unscheduled downtime and upgrading works that began in April last year,” it said.
The research house said both the group’s RE and WTE revenue is higher at 21% and 13%, respectively, quarter-on-quarter for the second quarter of 2025 due to increased contribution from a newly completed LSS3 project in Terengganu, as well as insurance compensation from a fire accident last year.
“RE operations recorded a pre-tax profit of RM24mil, mainly due to a RM30mil reversal of provision. The WTE operations’ pre-tax loss narrowed to RM8mil due to the insurance compensation,” it said.
The research house pointed out that overall group tax was unexceptionally high in the second quarter because of a one-off derecognition of deferred tax assets of RM7mil.
Maybank Investment Bank said excluding the reversal of provision, Cypark’s core loss was RM30mil for the second quarter and RM55mil for the first half of 2025, with both exceeding its consensus of RM26mil and RM34mil, respectively.
“We forecast RM54mil core net loss in financial year 2025 (FY25) after adjusting for higher tax and financing costs.
“We, however, raise our engineering, procurement, construction, and commissioning (EPCC) job win forecasts for FY26 and FY27 to RM300mil per annum on better EPCC win prospects from the National Energy Transition Roadmap projects,” it said.
It added this would lead to a higher FY26 and FY27 core net profit of 42% and 39% respectively, while turnaround is expected from optimal performance at the WTE sector.
