Samaiden Group Berhad - 99.99MWac LSS5+ Win
Thu, 04-Sep-2025 09:20 am
by Tan Sue Wen • Apex Research

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SAMAIDEN (0223)

Target Price (RM)

1.40

Recommendation

Buy

  • SAMAIDEN has received a Letter of Notification (LON) from the Energy Commission to develop a 99.99MWac LSS plant in Johor under LSS PETRA 5+, with commercial operation targeted by October 2027. The project is estimated to contribute approximately RM4m in annual PATMI to the Group.

  • In the near term, growth is expected to be supported by the CRESS programme, following the government’s recent reduction in the SAC, which has enhanced the attractiveness of solar investments.

  • Maintain BUY recommendation with a higher TP of RM1.40 (from RM1.35), incorporating the 99.99MWac solar project in our SOP valuation, alongside a three-star ESG rating.

 

LSS5+ win. SAMAIDEN has received a Letter of Notification (LON) from the Energy Commission to develop a 99.99MWac large-scale solar (LSS) plant in Segamat, Johor under the LSS PETRA 5+ programme (Package 3). The project is scheduled for completion by October 2027 (2QFY28) and will supply electricity to Tenaga Nasional Berhad (TNB) under a 21-year Solar Power Purchase Agreement (SPPA).

 

Our Take. We view the development positively as it provides the Group with an additional source of recurring income. Applying a rule of thumb of RM2.2m/MWac based on solar module prices of USD0.09/watt, the estimated capex for the 99.99MWac plant is c.RM220.0m. Assuming an 80:20 debt-to-equity structure and dispatch tariffs in the range of 13–16 sen/kWh (industry estimates), the project is expected to deliver a mid-single-digit IRR. We estimate an annual PATMI contribution of ~RM4m to SAMAIDEN. Financing is unlikely to be an issue, given SAMAIDEN’s net cash position as at 4QFY25 and its RM896m in unused sukuk issuance capacity. As the sole project owner (100% stake), SAMAIDEN is also likely to undertake the EPCC works.

 

Outlook. This marks SAMAIDEN’s second sizable solar project win after LSS5, bringing its effective RE portfolio to c.250MWac. To recap, the Group is targeting 10% recurring income by 2027 (from less than 1% in 12MFY25), with solar farms expected to remain the key driver in scaling towards this goal. In the near term, growth is likely to be supported by the CRESS programme, where the recent reduction in the SAC has made solar offtake more competitive relative to the Green Electricity Tariff (GET), thereby enhancing the appeal of solar investments for own consumption, particularly among corporates seeking to offset carbon emissions. This is expected to spur CRESS uptake, thereby providing an additional tailwind for SAMAIDEN’s expansion. Backed by a robust balance sheet and RM720m sukuk headroom (post-LSS5+ allocation), the Group has the capacity to finance up to ~320MWac of solar projects. We believe SAMAIDEN is well-positioned to scale its portfolio and deliver on its medium-term growth objectives.

 

Earnings revision. There are no changes to our earnings forecast, as contributions from the LSS5+ solar plant will only be reflected from FY28 onwards.

 

Valuation & Recommendation. Maintain our BUY recommendation with a higher TP of RM1.40 (from RM1.35), incorporating the 99.99MWac solar project in our SOP valuation, alongside a three-star ESG rating. We continue to favour SAMAIDEN for its (i) expertise in ground-mounted solar PV projects, (ii) industry-leading low gearing with a net cash position as of 4QFY25, and (iii) strategic focus on bioenergy solutions, which sets it apart from other solar EPCC players.

 

Risks. Increase in solar module costs. Inability to complete projects in time. Intense market competition.

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