PETALING JAYA (June 9): PUC Founder plans to divest its biometrics division within the next two quarters, due to reduced contribution from the unit. The biometrics division involves fingerprint-verification products.

PUC Founder (valuation: 1.1; fundamental: 2.15) managing director Cheong Chia Chieh said reduced contribution from the biometrics, and media and advertising divisions, had weakened the company's financials.

"About 90% of our revenue come from the media and advertising division," Cheong said after PUC Founder's annual general meeting here today.

PUC Founder's diversification into power generation will be closely watched. Cheong said the company projected a 21-year recurring income of RM1 million annually, from its proposed solar power plant in Sungai Petani, Kedah.

He said the power plant would have an initial one megawatt (MW) capacity, involving a tariff of RM1.035 per kilowatt an hour (kWh).

"The steady income from the energy sector would balance out the risks in the e-payment and mobile internet sectors.

"The return on investment from the energy sector is quite stable, whereas the mobile Internet plus and e-payment sectors have higher risk and growth," Cheong said.

In March this year, PUC Founder subsidiary MaxGreen Energy Sdn Bhd received the feed-in-tariff (FIT) approval from Sustainable Energy Development Authority (SEDA) to develop and operate the company's estimated RM8 million 1MW solar power plant.

Today, Cheong said PUC Founder was embarking on the expansion of its solar power project to 50MW. He said PUC Founder planned to obtain approval from Tenaga Nasional Bhd to sell electricty to the state-controlled utility.

He was, however unable to disclose the cost of the 50MW solar power plan project, only indicating it would require phase-by-phase funding.

"We are in the midst of looking for land and seeking knowledge, because 50MW is huge. We are also enhancing our capabilities through mergers and acquisitions," he said.

Cheong said PUC Founder was looking to acquire any engineering, procurement and construction (EPC) company, to strengthen its base in the energy sector.

At 12:30pm, PUC Founder shares settled unchanged at 14 sen, giving the company a market capitalisation of RM149.2 million.

A total of 140,000 share changed hands.

(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)