Analyst Sean Lim reiterated the research firm’s “buy” call on the counter, albeit with a lower target price of RM3.06 compared to RM3.12 previously.
During a stakeholder engagement event on June 14, the energy infrastructure and technology company emphasised its determination to have 30% of total equity in green investments by 2030, from 8% as of financial year 2023.
“We continue to have a positive long-term outlook on Yinson’s commitment to its green transition,” said Lim.
“(Yinson) continues to delve into green technology and renewable energy, while its FPSO business should still be the major earnings contributor for the time being,” said RHB Investment in a research note today.
The group targets to achieve annual renewable energy generation levels of 1.7 terawatts per hour (TWh) by 2025 and 5.6 TWh by 2030.
Yinson’s renewable energy division is currently operating in nine markets, including India, Brazil, Peru and Chile. The company is exploring opportunities in new markets such as the UK, Spain and the Philippines.
In line with Malaysia’s aspiration to establish 10,000 electric vehicle (EV) charging stations, Yinson plans to expand its EV charging network to 3,000 chargers. It currently operates 359 chargers, reportedly equivalent to a 30% market share.
Regarding Yinson’s other renewable energy projects, the report mentioned that the company has projects with capacities of 1,066MW in the development and consent phase, as well as over 4,400MW in the site investigation stage.
FPSO primary driver
Despite Yinson’s green energy drive, RHB Investment emphasised that the FPSO business will remain its primary driver of earnings for the time being.
The group targets to operate a fleet of 10 FPSO vessels by 2030. It currently employs five operational FPSO vessels, one operating floating storage and offloading vessel, and three FPSO vessels under construction.
The company’s order book, which includes both firm contracts and options periods, amounts to a total of US$22.5 billion (RM100.7 billion).
“While we are positive on its green technology arm in the long run, we have yet to include it in our valuation – since this business may remain in the red over the near term,” said Lim.
As at 3.51pm, Yinson’s share price was down 0.78% or 2 sen to RM2.56, giving it a market capitalisation of RM7.84 billion.