Solarvest Shortlisted For Its 50MW Bid Of Solar Assets In LSS@Mentari

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Solar photovoltaic system specialist, Solarvest Holdings Berhad (“Solarvest” or the “Group”) (stock code: 0215) was shortlisted, via its wholly-owned Atlantic Blue Sdn. Bhd., as one of the successful bidders in the LSS@Mentari programme to provide cumulative capacity of 50 megawatts (“MW”) of solar-powered electricity via three large-scale solar farms. The shortlisted bidders were announced last Friday by the Energy Commission.

Solarvest is confident that the Group is in good position to fulfill the requirements and financial close for the bids, backed by its robust financial strength. The Group recently raised a total of RM38.7 million from the issuance and private placement of 32.0 million new shares at an issue price of RM1.21 per share, which boosted its cash in hands to RM80.3 million. Solarvest is in net cash position of RM64.3 million and maintained a low gearing ratio of 0.1 times as of 31 December 2020.

Among the three shortlisted bids, the largest solar farm has a capacity of 25MW which will be based in Manjung, Perak. This is followed by a 13MW solar farm to be constructed in Kuala Selangor and another 12MW solar farm in Manjung, Perak.

Barring any unforeseen circumstances, the solar plants are expected to be operational by end of 2022 and 2023. Upon completion of the solar plants, Solarvest expects earnings contribution of approximately RM8 to 9 million annually from the three solar farms. This recurring income will contribute positively to the financial performance of Solarvest during the entire tenure of the 21-year power purchase agreement which is expected until year 2043.

Group Chief Executive Officer of Solarvest, Mr. Davis Chong Chun Shiong (俊雄) said, “We are thrilled to be shortlisted for the tender as it marks a major leap forward in our expansion plans. This will open up potential recurring income stream for us that will significantly boost our earnings visibility in the long run. We are looking for more investment opportunities for large-scale solar projects in both the domestic and overseas market, such as Taiwan, to expand our portfolio of solar assets.”

“We believe our investments in solar assets will yield attractive returns as the cost of construction will be relatively controlled given that we will be constructing the power plants ourselves. In addition to rising domestic demand, we are seeing utility companies joining force to pave ways for cross-border electricity distribution, hence, we believe the export of clean energy will be the next key driver for growth in Malaysia. Our aim is to expand our solar asset portfolio to be one third of the Group’s total revenue in three to five years,” he further added.

The Group is also bidding for Engineering, Procurement, Construction and Commissioning (EPCC) projects from other successful bidders in the LSS@Mentari programme. Solarvest aims to clinch approximately 300MW of EPCC projects, worth about RM600 to RM700 million, which will boost its financial performance in FY2021 up till FY2023.

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