Gamuda may bag extra jobs for estimated RM4bil Ulu Padas dam project
Economy & Business
By S. Birruntha
KUALA LUMPUR: Gamuda Bhd is expected to secure additional construction contracts from the Ulu Padas hydroelectric dam project, which is scheduled for completion by 2030.
CIMB Securities said aside from generating electricity, the dual-purpose dam is also designed to address water supply issues in Sabah through the Ulu Padas Water Supply Scheme, which is linked to the project.
"This unique water supply scheme has the potential to deliver up to 6,000 million litres per day (MLD) of water, a critical contribution to meeting Sabah's water demand for up to 100 years," it said.
CIMB Securities highlighted that Phase 1 of the Ulu Padas water supply scheme has been listed among 13 high-impact water supply projects that are either already underway or in the implementation stage.
During its first half of financial year ending July 2025 results briefing last month, Gamuda said it expected to secure RM4 billion worth of water-related infrastructure works under the Ulu Padas hydroelectric dam project.
CIMB Securities believes the contracts will likely stem from the Ulu Padas Water Supply Scheme.
The project is part of a pipeline of high-conviction bids collectively worth RM35 billion that Gamuda is targeting over the next two to three quarters.
"This indicates potential upside to the group's end-2025 outstanding order book target of RM40 billion to RM45 billion (as of January 2025: RM36 billion, year-to-date FY25 wins: RM14.5 billion)," it added.
CIMB Securities said its current model does not yet factor in potential recurring income from Gamuda's effective 45 per cent stake in UPP Holdings, pending further updates on its tariff structure.
Given its sturdy order book outlook, CIMB Securities maintained its "Buy" rating on Gamuda with an unchanged target price of RM5.50.
The Ulu Padas hydroelectric dam project is scheduled to be completed by 2030 following its groundbreaking ceremony on Dec 7, 2023.
The development is led by Upper Padas Power Sdn Bhd (UPPSB), a wholly-owned unit of the UPP Holdings consortium, which comprises Gamuda (45 per cent), Sabah Energy Corp (SEC) (40 per cent) and the Kerjaya Kagum Hitech JV (15 per cent).
Based on an estimated project development cost of RM4.7 billion, the dam has an initial operating period of 40 years, with projected annual revenues exceeding RM400 million and state utility company Sabah Electricity Sdn Bhd as its sole offtaker.
Further out, the project may include a 200 megawatt floating solar scheme on the lake created by the Ulu Padas dam, eco-tourism, fisheries and forest research.
Source : gamuda-may-bag-extra-jobs-estimated-rm4bil-ulu-padas-dam-project
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