NST Business
KUALA LUMPUR: A global renewable energy (RE) fund is said to be eyeing investments in local solar firms and may target Vsolar Group Bhd.
Vsolar is bidding for renewable energy projects, including contracts under the Large Scale Solar (LSS) scheme.
People with knowledge on the matter said the fund was looking at Malaysia as RE penetration here was still low, having reached only eight per cent of the energy mix, generated by LSS plants, feed-in tariff and net energy metering developers.
The world's top RE funds include BlackRock, RobecoSAM and Vontobel.
It is unclear which of the funds is looking to invest in Malaysia.
"There is potential for huge growth in Malaysia. The global fund wants a share in local energy projects. It arranges funding packages by taking equity stakes in companies around the world which have RE projects in hand or are bidding for contracts.
"The fund manager may target Vsolar as the stock is undervalued and they believe it has the potential for growth, having recently established a partnership with Mattan Engineering Sdn Bhd to bid for an LSS project of 50 megawatts (MW) from the government," a source said.
Malaysia recently opened competitive bidding for one gigawatt (GW) of solar plants worth about RM4 billion, the largest capacity offered under the LSS scheme.
The Ministry of Energy and Natural Resources, via the Energy Commission, is requesting proposals through a competitive bidding process for the development of the fourth cycle of LSS (LSS4) projects.
The bidding process is open to fully-owned local companies or with at least 75 per cent local shareholding for companies listed on Bursa Malaysia.
The solar plants under LSS4 are expected to start operating latest by December 31, 2023.
The development of each plant would take up to 18 months.
It is understood that Vsolar was eyeing more than one LSS project of 50MW.
The stock closed 1.5 sen higher today at seven sen.
Some 380.8 million shares exchanged hands. Volume-wise, Vsolar was the second most active stock traded on Bursa.
In a filing with Bursa on June 16, Vsolar said its wholly-owned Cubetech Asia Sdn Bhd, intended to bid and secure a quota under the LSS scheme, with the support of Mattan as the EPCC (engineering, procurement, construction and commissioning) partner to develop the project.
The Energy Commission has set the bidding process to be closed on September 2 to
ensure that any successful bidder can launch their solar facility by the first quarter of next year.
Vsolar said it tied up with Mattan as it had completed a variety of turnkey projects.
In November 2017, Mattan was appointed the turnkey EPCC contractor of a LSS facility generating up to 50MW in Rembau, Negri Sembilan, which as of to date, is ranked as one of the largest solar farms in Malaysia.