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Property News

CGS-CIMB positive on Sime Darby Property’s green energy initiative

KUALA LUMPUR (July 28): CGS-CIMB has maintained its “add” rating of Sime Darby Property Bhd at 59 sen, with an unchanged target price of 73 sen, and said it was positive on the developer’s plans to introduce solar solutions for townships by leasing rooftops from homebuyers to instal solar panels, and supply to offtakers.
In a note on Friday (July 28), the research house said the initiative supports the government’s vision to achieve 70% renewable energy generation capacity by 2050.
According to CSG-CIMB analyst Chong Tjen-San, the company plans to create an ecosystem, where existing unutilised rooftops built by Sime Darby Property will be used to meet growing demand for green energy in Malaysia.
Sime Darby Property mentioned it could generate about 150MW from 15,000 rooftops in the City of Elmina, Shah Alam’s residential landed units over the next five years.
Based on the company’s data, the location spans 6,500 acres (2,630 hectares) comprising industrial, residential and commercial units that is projected to require about 2.2 billion kWh of energy per annum upon completion by 2040.
However, Chong said downside risks such as delays in planned launches and wider-than-expected share of losses from Sime Darby Property’s Battersea Power Station joint venture would have to be taken into consideration in terms of dragging down net earnings.
At the time of writing on Friday, shares in Sime Darby Property traded 10 sen or 0.46% lower at RM2.16, giving the group a market capitalisation of RM3.98 billion.

Source: EdgeProp.my

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