Renewables Enter New Growth Cycle, SLVEST Remains Top Pick

Apex Research has reiterated its OVERWEIGHT call on Malaysia’s renewable energy sector, highlighting supportive policy reforms, expanding opportunities in solar and battery storage, and improved earnings visibility for key players. Solarvest (SLVEST) remains its top pick (TP: RM3.15).

Solar ATAP – Structurally Sustainable, Less Lucrative

Apex: “We view ATAP as structurally more sustainable but economically less lucrative than NEM.” Consumer savings will be “lower due to the exclusion of capacity charges and the use of SMP.” Adoption momentum will be “slower than during the NEM era,” but demand should revive among “high-consumption households, SMEs, and larger C&I users.” Beneficiaries: “PEKAT (BUY, TP: RM1.72) and SLVEST (BUY, TP: RM3.15) are well positioned to capture the recovery in demand.”

LSS5+ – RM12–14b in EPCC Opportunities

Apex: “We expect EPCC job flows from LSS5+ projects to begin from 1H26.” 4GW awarded under LSS5 and LSS5+ auctions, worth “RM12-14bn of solar EPCC opportunities.” Industry players (SAMAIDEN, MALAKOF-SLVEST, SUNVIEW-CYPARK, YTLPOWR, TENAGA) have secured significant capacity. Apex: “We expect the largest beneficiaries to be SLVEST and SAMAIDEN.”

CRESS – Lower Grid Access Charges Driving Adoption

SAC and CAC were cut by up to 40% in August 2025. Apex: “We believe the revised rates will stimulate stronger adoption of CRESS, particularly from data centre operators.” Power costs for data centres have risen by ~26%, making CRESS a “viable pathway to offset rising costs.” Beneficiaries: “SLVEST and SAMAIDEN as key beneficiaries, given their strong exposure to utility-scale solar.”

Rising Solar Module Prices – Margin Risk

Module prices up ~10% due to China’s anti-involution measures. Apex: “A two-cent increase in module prices could translate into an additional 15-20% in overall project costs.” Larger players are better positioned: “SLVEST and SAMAIDEN are better positioned to manage the increase and secure competitive supply, while smaller players may face margin compression.”

BESS – The Sector’s Game-Changer

Apex: “We view BESS as a game-changer for Malaysia’s energy transition.” MyBeST targets 400MW/1,600MWh by 2027; each project worth up to RM500m. BESS business model includes “fixed capacity payments (90% of revenue)” plus variable service charges. Apex: “We believe the first awardees will likely command a valuation premium.” Strongest contenders: “SLVEST and SAMAIDEN, supported by extensive utility-scale solar track records and solid balance sheets.”

Sector Call

Apex: “Maintain OVERWEIGHT rating on the sector. Top pick remains SLVEST (TP: RM3.15).”

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