Verdant Solar Holdings Berhad (VERDANT): Go Green. Go Solar. Go Verdant.

As Malaysia accelerates its renewable energy push, one home-grown player continues to shine brightly: Verdant Solar Holdings Berhad (VERDANT). Founded in 2015, this solar PV EPCC (engineering, procurement, construction, and commissioning) specialist has built a strong track record in turnkey solutions for residential and commercial solar projects.

The company’s credibility is underscored by its Malaysia Book of Records recognition for the most solar PV home installations (2022–2024), positioning it as a trusted leader in the solar retail segment.

Business Model Snapshot

VERDANT generates revenue primarily from:

• EPCC (95.5%) – turnkey solar PV solutions remain its core engine.
• O&M (0.4%) – operations & maintenance services.
• Trading (0.6%) – supplementary revenue from equipment and accessories.

This revenue mix highlights VERDANT’s focus on execution and delivery, rather than long-tail ancillary services.

Growth Outlook: Sustained Momentum

Looking ahead, VERDANT is projected to deliver earnings CAGR of 9.1% over FY26–FY28, with net profits rising from RM17.7m → RM22.4m. Growth will be supported by:

1. Robust order book replenishment – contracts are typically short-term, allowing faster revenue recognition.
2. Government backing – initiatives like SELCO, GET, CREAM, and Solar ATAP strengthen demand for rooftop and large-scale solar.

Importantly, VERDANT’s current order book stands at RM31.1m, largely expected to be recognised within FY26, underpinning earnings visibility.

Expansion & Future Strategies

VERDANT is gearing up for the next phase of growth:

• Geographic expansion: ~RM14m (31.8% of IPO proceeds) will fund new branches in Ipoh, Melaka, and Kuantan, boosting on-the-ground presence across Peninsular Malaysia.
• M&A opportunities: ~RM10m (22.7% of IPO proceeds) earmarked for acquisitions to strengthen its foothold in C&I solar PV systems and entry into large-scale solar (LSS) projects. This move diversifies its revenue base beyond residential solar, opening higher-ticket markets.

Financial Highlight

• Revenue growth: From RM14.7m in FY22 to RM111.4m in FY25 (CAGR 96.4%) – a stellar trajectory driven by strong adoption of residential solar and rising C&I demand.
• Margins: PAT margin expanded from 5.6% (FY22) to 15.4% (FY25), outperforming peers’ average of 8.2%.
• Forecast: Normalised gross margin ~36% and net margin ~13% over FY26–FY28.

This margin resilience highlights efficient cost control despite reliance on subcontractors, a common industry pain point.

Valuation: Fair Value at RM0.41

We assign VERDANT a target P/E of 18.0x, benchmarked against:

• Directly comparable subsidiaries in the solar retail segment.
• 10-year Bursa Utilities Index average.

This implies a fair value of RM0.41 per share, versus peers trading at ~22.7x P/E. The discount reflects VERDANT’s niche residential solar focus, though upside remains if C&I and LSS expansion executes successfully.

MyBursaWatch Takeaway

Verdant Solar is no longer just a residential solar installer — it is evolving into a broader renewable energy solutions provider, balancing retail strength with new growth opportunities in C&I and LSS.

Backed by consistent earnings growth, expanding margins, and strong policy tailwinds, VERDANT looks well-positioned to ride Malaysia’s green energy wave. At RM0.41 fair value, it offers a compelling growth story with measured risks, particularly tied to execution in expansion and M&A.

Verdict: 🌱 Go Green. Go Solar. Go Verdant.