RENEUCO 7130 RENEUCO BERHAD gets renewed interest as it powers on. How far can it go?

 RENEUCO 7130 RENEUCO BERHAD gets renewed interest as it powers on. How far can it go?


Reneuco Bhd has been on an upward trend over the last 5 days, surging 30% to close at 26 sen on June 12.


On June 12 alone, the counter rose 18% on active trade while its warrants rose 11% to close at 10 sen.


It has done well to reach the current level from its 52-week low of 19 sen but still well below its year high of 40 sen.


Is the worse over the company once dragged by its association with Serba Dinamik owner Datuk Abdul Karim?


Abdul Karim was charged a year ago by the Securities Commission for furnishing a false financial statement to Bursa Malaysia.


It was a tough period for Reneuco, which was not at all part of the financial scandal, as it had Abdul Karim as its substantial shareholder.


Formerly KPower Berhad, ithe company's sustainable energy and utility segment involves construction-related activities and specialised engineering services for projects locally and abroad.


Financially, it is not far from amazing.


For the third quarter ended Mar 31, 2023, Reneuco’s net profit fell to RM1.9 million from RM6.7 million a year ago while revenue declined to RM22.2 million from RM50.3 million.


The company has been busy with new ventures and tie-ups.


In May, it entered into a MoA to explore a collaboration into a green energy business in Perak.


It wants to tie-up with Pengurusan Murni Sdn Bhd (PMSB), a wholly-owned subsidiary of Perak Industrial Resources Sdn Bhd (PIRSB), and Aero Line Facilities & Engineering Services Sdn Bhd (ALFES) for the green energy venture.


Under the proposed agreement, Reneuco and ALFES will be contracted to supply smart solar LED lighting to PMSB and PIRSB for a smart solar project.


Earlier on April 20, Reneuco and Citiglobal Bhd won a tender to develop an independent power producer (IPP) project for the East Coast Rail Link (ECRL) network.


Both groups formalised their collaboration via a new special purpose vehicle (SPV).


The proposal submitted by the SPV involves the supply of renewable power to commercial or industrial parks along the ECRL's 640km alignment.


Citaglobal, formerly known as WZ Satu Bhd, will contribute 60% and Reneuco 40% of the RM500,000 initial share capital of the SPV.


Citaglobal will lead the negotiations with Malaysia Rail Link Sdn Bhd to finalise the terms and conditions for the IPP project.


MRL — an entity of the Ministry of Finance — is developing the ECRL project and will operate it in a 50:50 joint venture with China Communications Construction Company.


It will be interesting to see how all the above will pan out for Reneuco as it will need a huge boost to restore investors’ confidence.
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