Apex Raises Samaiden’s Target Price By 27.7%

Established in 2013, Samaiden debut on the ACE Market of Bursa Malaysia in 2020 and, transitioned to the Main Board in 2023. Specialising in EPCC services for solar, biomass, biogas, and hydro-related projects, the Group has successfully completed over 200 RE projects.

Samaiden’s regional expansion entails strategically formation of partnerships and collaborations with local entities to unlock new growth opportunities. The Group has established subsidiaries in high-growth potential markets, including Cambodia,
Singapore, and Vietnam, thereby enhancing market presence and visibility. Since 2023, Samaiden has entered into several MOUs with companies in Taiwan and Cambodia, focusing on development of RE and sustainable economic projects, laying the groundwork for market penetration and business expansion.

Apex Securities views Samaiden as one of the prominent EPCC players in Malaysia, having completed LSS EPCC projects with a total capacity of 379.0MW. The Group has received several notable awards, including recognition by the Malaysia Book of
Records for constructing the ‘Largest Solar Rooftop by a Single Company’ with a total capacity of 30.4 MW, and the SME 100 Award for Fast Moving Companies. Notably, Samaiden was the first in the industry to complete and commence commercial operation of one of the LSS4 projects.

The house initiates coverage on Samaiden Group Berhad with a BUY recommendation and a target price of RM1.66 based on Sum-of-Parts (SOP) valuation. Applying a 30.0x P/E multiple to the EPCC contribution, which represents slight discount to 35.0x PE the house assigns on the closest peer, Solarvest’s, after taking into consideration of Samaiden’s smaller market cap and market share in solar installations industry.

Meanwhile, we derive the value of the solar assets from DCF methodology, with key assumptions of WACC at 6.6%.

It favours Samaiden due to (i) a solid track record of delivering 200 RE projects in a timely manner, (ii) specialization in ground-mounted solar PV systems, capturing an average of 15.4% market share of EPCC jobs from LSS projects, (iii) expertise in bioenergy solutions, particularly in biomass, (iv) robust order book replenishment, consistently around RM350.0m, (v) strong fundamentals, with a net cash position of RM96.9m and a low gearing ratio of 0.04x as of 9MFY24, (vi) benefits from the normalisation of solar module prices, and (vii) long-term RE industry growth potential from the rollout of NETR.

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