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Wednesday, 26 July 2017

Partially : Edra Power expected, target listed on Bursa Malaysia; in November list to raise RM5.00 billion.

Malaysia : Independent power producer (IPP), Edra Power Holdings Sdn Bhd, is expected to be listed on the Main Board of Bursa Malaysia in November this year. 

Capital market industry sources said the company, which is Malaysia's second largest IPP and the world's leading nuclear power company, is expected to raise more than RM5 billion from its listing. 

Analysts said "Edra is a good one for Malaysia's economic recovery" as the listing proposal was made in positive economic indicators, including strong growth and exports and rising ringgit. 

What is most prominent is the revision of the 2017 World Economic Growth by the World Bank to 4.9 percent from 4.4 percent previously, Higher than the government's own project on the back of a very lucrative first-quarter performance. 

Also contributing to the positive sentiment is the ringgit, cited as the strongest currency in Asia. 

This was attributed to the strong inflows of foreign funds into the stock market, which recorded a two-year high, closing above the 1,787 point level in early June, and supported by positive corporate earnings.

In that case, analysts say the upsurge on Bursa Malaysia will give a good prospect for the listing price of Edra, which despite not being set, will make the initial public offering (IPO) re-launch. 

This is because Edra is expected to be a blockbuster IPO with key fund managers such as the Employees Provident Fund, Inclusive Retirement Fund, Tabung Haji and Khazanah Nasional Bhd are now "increasingly active" in view of increased demand for new listings. 

"It will be a focused listing that will also attract retail investors to engage as shareholders in the company," said an analyst. 

He said China's General Nuclear Power Corp (CGN), which has fully Edra, May release about 35-40 percent of its shares in the market as part of the listing step. 

"They plan to return the ownership of the company to Malaysians which is a natural evolution in the capital market," said the analyst. 

It will benefit Malaysian investors as being an international leading company in clean energy, Edra has many networks with local and international utility companies, he said. 

As a global nuclear energy company it has invested more than 25 gigawatts in clean and renewable energy projects. 

The projects include wind, solar, hydro, gas, coal, coal and hydrocarbon projects in China, South Korea, Singapore, the United Kingdom, France and Australia. 

And with the acquisition of Edra by CGN last year, it has brought a growth era for its investments in Malaysia. 

For example, the company will build its large-scale solar photovoltaic plant in Kedah in early 2018, with a capacity of 50 megawatts (MW). 

The project, known as the Kedah Solar Project, will convert agricultural land in Kuala Ketil into an industrial base that produces renewable energy, thereby bringing significant positive impact to the state's economic growth. 

It will also develop Malaysia's largest combined gas turbine cycle (CCGT) in Alor Gajah, Melaka with 2,242 MW power. 

Once completed, the project, which will provide the most cost-effective fuel conversion, Will become Malaysia's largest CCGT power. 

"It will be a fun time again for investors who want to join Edra's high-growth growth even to retail participants through its public listing," said the analyst.

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