KUALA LUMPUR: Samaiden Group Bhd is expected to post a stronger second half (2H) of 2024 earnings, with some projects reaching a stronger recognition cycle, said Hong Leong Investment Bank Bhd (HLIB).
HLIB said Samaiden's unbilled orderbook, which stands at a robust level of RM418 million, should serve as a significant driver of future earnings.
Despite the already strong orderbook, HLIB reckons its engineering, procurement, construction, and commissioning (EPCC) orderbook could further expand on the back of formalising CGPP contracts.
"The programme could generate RM2.7 billion to RM3.0 billion of construction jobs for the sector," it said.
Meanwhile, HLIB said the recent announcement of 2 gigawatts (GW) of Large Scale Solar (LSS5) (RM7 billion) effectively removes the risks of post-CGPP contract hangovers.
Malaysia's plans are to ramp up solar capacity to 7,280 megawatts (MW) by 2035, marking a substantial increase of 5,746 MW compared to the 2020 installed capacity.
"This anticipated expansion will drive demand for EPCC contractors like Sameiden, renowned for their strong track record in serving LSS projects," it said.
Additionally, HLIB said Sameiden distinguishes itself by boasting a more diversified exposure to RE sources, including biogas and biomass, setting it apart from most EPCC players listed on Bursa Malaysia, which predominantly focus solely on solar projects.
"This positions Sameiden to benefit from increased focus on biomass and biogas developments, which often present greater complexity and higher barriers to entry compared to typical solar projects.
"Sameiden is building a base near the support region of RM1.28–1.31 with indicators on the mend.
"A successful breakout above the RM1.35 hurdle will spur the price toward the RM1.41-1.46-1.50 region. Cut loss at RM1.22," it added.
