KUALA LUMPUR (Aug 25): Scomi Group Bhd is confident it will secure a monorail project in one of China's Tier-3 cities and is looking to ink a deal within the next few months.

Scomi Group chief financial officer Mukhnizam Mahmud said there are only three monorail producers in the world, which are Bombardier Inc, Hitachi Ltd, and Scomi Group, which will give the group an advantage in securing the project.

"The Chinese don't have the technology yet. So I guess there will only be these three companies that will bid in the monorail projects," Mukhnizam told reporters at a media briefing after the group's annual general meeting here today.

China's Tier-3 cities are classified as smaller cities that have a gross domestic product of between US$18 billion and US$67 billion with a population of 150,000 to 3 million people.

According to Scomi Group's annual report, the company is looking to capitalise on China's new policy in favour of monorail, whereby Tier-3 and Tier-4 cities can only build monorails as opposed to mass metro lines for its public transportation.

On the group's recent corporate proposal, Mukhnizam said the extraordinary general meeting for all three related parties will convene around November and that the consolidation exercise is expected to be completed before the end of its financial year on March 31, 2018.

On Monday, the group announced a proposed group-wide restructuring to consolidate its energy and engineering subsidiaries, Scomi Energy Services Bhd and Scomi Engineering Bhd, via a share swap exercise with free warrants to hasten decision-making processes, cut down operational expenses and strengthen the group's balance sheet.

Asked when he expects the group to return to black after a loss-making year, he said: "It's hard for us to put a time frame simply because it's dependent on the market and unfortunately we don't see any recovery in the market for oil and gas, at least not over the next two years. But what we can do is control our cost structure."

Scomi Group country president for Malaysia Zubaidi Harun added that new government policies that encourages renewable energy generation will help the company's new venture in that sector.

"I think we are entering the market at the right time where government policies also help us in creating this new demand," he said.