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Wednesday, September 24, 2014

VSOLAR - Solar Synergy

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Malaysia is on the track in seeking to intensify the development of renewable energy which was set of since 2011 as to reduce the carbon income of the country through renewable energy such as Solar Photovoltaic (PV), Biomass / Biogas and Hydro Power Electricity. Which this in line, the government had been reinforced by fiscal incentives such as investment tax allowances and the SREP (Small Renewable Energy Program) which encourages the connection of small renewable energy power generation plants to the national grid.

With this in line, on 6th January 2014, VSOLAR (formerly known as Fastrack Solution) had restructure the company direction and core business direction towards the renewable energy sector, with a focus in the solar farming industry.

Let's have a quick look at VSOLAR price chart

VSOLAR had been trending in the range of RM 0.14 before the break up above RM 0.15 which mark a new up trending move on VSOLAR. As VSOLAR had realign their core business focus into solar farming, VSOLAR will be expected to see more interested investor in the coming days, which will be looking to see more participating volumes in the coming days. A quick resistance will be placed at RM 0.20, while a convincing strong breach above RM 0.20 with a good supporter volume will put VSOLAR trading in the uncharted territory.


VSOLAR - Power of Solar

Solar Interactive Sdn Bhd, a wholly owned subsidiary of VSOLAR, had on 1st August 2013 entered into a Renewable Energy Power Purchase Agreement (REPPA) with TNB for the sale and delivery of renewable energy by for a concession of 21 years. For a start, VSOLAR had started a 500kW solar farm in the region of Simpang Pulai, Kinta, Perak with a Feed-In Tariff (FIT) rate of RM 1.3812 /kWh, commenced 3rd November 2013.

The renewable energy sector had been a hot topic recently, which had saw a number of listed company that had direct business relation in the sector being getting much public interest. Let's have a quick look at the following company which is on a hot stint in renewable energy.

1. Fitters Diversified Berhad (Fitters - 9318)

Future NRG Sdn Bhd (FNRG) is involved in biomass to renewable energy-distributed generation and combined heat and power projects. This includes biomass gasification for rural electrification, captive power and grid-connected plants with capacities up to 4Mwe and also conventional steam cycle power plants apply for larger capacity projects  


2. Amcorp Properties Berhad (AMPROP - 1007)

AMPROP had been a hot target for investor after emerging as the single largest solar farm with 10.25MW capacity located at Gemas, Negeri Sembilan. AMPROP had been in a strong uptrend since 80 cents, hitting a high at RM 1.49.

3. Tek Seng Holdings Berhad (TekSeng - 7200)

Tek Seng had been in a strong uptrend after seeing a strong record of orders for the solar panel after seeing huge appetite in the Solar Farming sector.


4. Cypark Resources Berhad (Cypark - 5184)

One of the more established player in the renewable energy sector will be Cypark. Cypark had solar farm spanning from Pajam and Bukit Palong of Negeri Sembilan, Kuala Perlis in Perlis and Rimba Terjun in Pontian, Johor. The 5th site will be located in Kuala Sawah, Rantau, which is the 3rd in Negeri Sembilan with is said to have a 6,475MWh annual generation capacity capable of powering 7000 homes with green electricity. Cypark aggressive expansion in the Solar Farming had also attracted savvy investor Chua Ma Yu into the sector as well.


Next Up Coming Catalyst

VSOLAR had saw a 10% private placement from Asia Bioenergy Tech Berhad (AsiaBio - 0150) recently. While under the SREP plan, the maximum allowable limit for an individual company is 10MW, which means Solar Interactive Sdn Bhd still have a capacity of 9.5 MW in the coming days to be installed.

According to sources, VSOLAR had been planning their phase 2 of solar farm which will be looking to see approximately 3 to 5 MW plant being set up.

VSOLAR will be the next big thing after CYPARK after realigning their business focus into solar energy farming. At the current market capitalization of RM 50 million, VSOLAR is just putting it's 1st step into the industry. A 10 MW solar farm will be able to generate a recurring income of around RM 11 to 12 million per year. With the new direction in VSOLAR, we believe that VSOLAR will be the next big player in solar farming in the coming days ahead.



At the current price of RM 0.18, VSOLAR is a very attractive target for a long term investment. A quick outlook will definitely put VSOLAR challenging RM 0.20 and testing RM 0.25 in a short term whilst a long term target will be looking at RM 0.50.

Solar and you? You decide.

Bone's short term TP : RM 0.30

Cheers and have a nice day

Regards,
Bone

1 comment:

  1. Seriously thought provoking post! Quite interesting things and have enjoyed immeasurably. Thanks
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