SAMAIDEN has successfully secured a RM25.8 million EPCC contract for a high-head hydropower plant in Terengganu from Tesdec Hydropower Sdn Bhd. This marks the company’s inaugural significant contract in FY24, elevating its year-to-date job wins to RM25.8 million and expanding its outstanding order book to RM377 million, ensuring substantial activity for at least the next 18 months. The contract, spanning 36 months from the site possession date on June 30, 2024, involves the construction of a 2MWac highhead hydropower plant.
This achievement contributes to SAMAIDEN’s optimistic outlook, with the company positioned to benefit from the National Energy Transition Roadmap (NETR) and the government’s target for renewable energy (RE) to constitute 70% of total power generation capacity by 2050. The company recently secured rights under the Corporate Green Power Programme (CGPP) for the independent development of 13.42 MWac and an additional 29.9 MWac through a consortium, potentially resulting in EPCC works valued at approximately RM170 million.
Maintaining a positive forecast, SAMAIDEN anticipates a gross profit margin of 14%-17% from this newly acquired contract. The company’s long-term growth is reinforced by various factors, including the increased commercial viability of solar power projects, its prominent role in the local solar EPCC market, and its ability to offer comprehensive solutions, including financing. Furthermore, its track record of delivering projects on time and within budget enhances its standing in the market.
Despite these positive aspects, potential risks to SAMAIDEN’s outlook include government policy adjustments related to RE, heightened competition in the EPCC sector, project execution challenges, and rising costs of inputs, particularly solar panels and labor. Nonetheless, the overall assessment prompts a continued “OUTPERFORM” rating, and the target price is maintained at RM1.44, reflecting a 5% premium based on the company’s 4-star ESG rating and comparable forward PERs of industry peers such as SVLEST and SUNVIEW.
Technical view:
- Reviewing from the daily technical chart, SAMAIDEN’s stock price rebounded from a higher low at RM1.100 and stayed above SMA200 line 2 months ago. Since last week, the stock price broke out RM1.100 and has been riding above all short and medium terms EMA lines until today and all the EMA lines are arranged in right ordered above rising SMA200 line. This indicates that the stock price is preparing to resume its initial stage of markup phase;
- Let’s monitor for the stock price to breakout and stay above RM1.100 for higher high. If the stock price could stay above RM1.100 with up trending momentum, then let’s monitor for the next possible short-term targets around RM1.140, 1.190, 1.240, 1.290. Long term investors may prospect for possible long-term targets to challenge around RM1.34 ; RM1.37 ; RM1.40 and RM1.44.
- Should the new higher high beyond RM1.100 be successful, trailing stop with EMA20 or EMA30 line, or if the stock price were to pullback unexpectedly, put the short-term stop loss below RM1.00 or worst case below RM0.980;
- The secondary indicators like MACD, DMI and RSI are at good junctures that could biased to lead the stock price to further rebound for higher high upside;
- Stock analyser shows fundamentally PFS9=3 indicates FA is not so good yet, and technically TAS20>65% indicates that the stock price may get ready to take off from the initial stage of its markup phase.
Fundamental:
SAMAIDEN BHD (SAMAIDEN , 0223) is listed under MAIN market’s Industrial Services / Renewable Energy.
Principal Products / Services:
- Engineering, Procurement, Construction and Commissioning (EPCC) solutions provider for Renewable Energy (RE) projects that include solar photovoltaic (PV), biomass and biogas system
- RE and environmental consulting services as well as Operation and Maintenance (O&M) services.
Financial ratios:
Catalyst Factors:
- Although the fundamental FA parameters are not so good yet, except PBR, but technically, the stock price may get ready to take off from the initial stage of its markup phase.