KUALA LUMPUR: Scomi Engineering Bhd (SEB) is keen on bidding for the upcoming mass rapid transit (MRT) and light rail transit (LRT) projects. 

“The government had said that the LRT3 and MRT 2 projects must have 30% local content, but today we are offering products that will achieve 60% local content, so yes, we are eyeing the Malaysian project,” said the company’s chief executive officer Kanesan Veluppillai.

The 36km LRT3 or Bandar Utama-Klang Line's construction work will begin in 2016 and is expected to be completed in 2020. The MRT2 or the Sungai Buloh-Serdang-Putrajaya line is expected to be up for tender by year-end and the contract awarded  by the first or second quarter in 2016, with Phase 1 opening by May 2021 and Phase 2 by July 2022.

According to Kanesan, the company has a tender book of about RM5 billion to RM8 billion for international MRT and LRT projects. SEB's monorail segment has a tender book of RM5billion to RM10 billion. Its order book stands at RM1.6 billion now.

He said the success rate for the monorail stands at 60%, but for MRT or LRT projects, the success rate would be between 10% and 15%.

The company is aiming to bid for three to four MRT and LRT projects in Indonesia, and one LRT project in Thailand, besides five projects in India it is targeting over the next two years.

“We are hoping there will be two tenders for the metro in Brazil this year,” said Kanesan adding that its monorail segment will tender for another eight projects in Turkey and a few projects in Colombo, Sri Lanka.

Kanesan was speaking to reporters after the signing ceremony between SEB and Czech transportation engineering company Skoda Transportation yesterday for the joint development of MRT and LRT vehicles. 

Kanesan said the 50-50 partnership will see both parties bringing individual technical and management skills and capabilities, which strengthens their joint transport solution offerings to global market.

This will also enable SEB to participate in a wider range of transport projects, including LRT and MRT projects, in addition to its existing monorail business, he added.

Skoda sales director, propulsion and control for East and Asia Jaromir Hajek, said the collaboration will help to grow its market in a fast pace and fulfil the requirement of local content.

Kanesan said the collaboration will not incur additional costs, as its existing plant in Rawang manufacturing its monorail would have a new line to build the MRT and LRT vehicles.   Apart from tendering for projects with Skoda, Kanesan said the collaboration will also allow both parties to tap into each other's market in different countries and different market segments.

Currently, 70% of the company's earnings are from overseas while the remaining 30% is from Malaysia. 

This article first appeared in digitaledge Daily, on September 3, 2015.