Uzma is currently bidding for a significant water injection project of which the outcome will be made known over the near term.
KUCHING (Feb 26): Uzma Bhd (Uzma) will commence execution of its RM450 million hydraulic workover units (HWU) order book in coming quarters as the monsoon season ends.
It is currently actively bidding for a new water injection project, which should bolster its recurring income starting from FY26.
“We came away from Uzma’s post-results briefing feeling upbeat about its near-term prospects,” commented researchers with Kenanga Investment Bank Bhd (Kenanga Research) yesterday.
“The group’s HWU business is poised for a significant increase in work orders from its clients in coming quarters.”
To recap, Uzma secured RM450 million worth of HWU-related jobs back in June 2023 but was unable to ramp up due to the incoming monsoon season.
This increase in work orders will boost Uzma’s HWU-related revenue, driving a significant year on year (y-o-y) growth.
Kenanga Research saw that Uzma is currently bidding for a significant water injection project of which the outcome will be made known over the near term.
“We understand that it is one of the frontrunners given its proven track record in executing the D18 water injection project.
“This project, won by the group in 2016, had a contract value of RM400 million and spanned five years. Our forecasts have yet to reflect any new water injection wins.”
Meanwhile, the group’s Sungai Petani Solar set to come online in 1QFY25. The 50MW solar power plant, located in Sungai Petani, has achieved a 70 per cent completion rate, marking a significant progress from 40 per cent in 1QFY24.
The project is on track for testing by Tenaga Nasional Bhd by the end of May 2024, with expectations to commence full operations by 1QFY25, ushering in initial earnings contributions from the NEDA Corporate Green Power Programme.