ACE Targets to Achieve 1,000MW Capacity by 2024, Analyst Recomm. “BUY” at ฿5.20 

Mr. Tanachai Bunditvorapoom, Chief Executive Officer of Absolute Clean Energy Public Company Limited (ACE), revealed that the company is under the process for negotiating a merger and acquisition (M&A) transaction with 3-4 partners which is expected to complete by this year. He further stated that ACE still maintains its production capacity milestone of 1,000MW by 2024.

 

On 19th March 2021, ACE announced that its 2 indirectly held 100% shares subsidiaries; ACE Solar Co., Ltd. (ACE Solar) and Bio Power Plant Co., Ltd. (BPP), have already signed Power Purchase Agreement (PPA) of Nabon 1 Clean Energy Power Plant and Nabon 2 Clean Energy Power Plant with the Electricity Generating Authority of Thailand (EGAT) respectively.

 

Nabon 1 and Nabon 2 SPP-Hybrid Power Plants are a biomass power plant with installed capacity of 25 MW each, and have PPA of 21.50 MW each with EGAT under Feed-in Tariff (FiT) scheme for the period of 20 years. Both projects are located in Nabon District,

Nakornsrithammarat Province.

 

With regard to the PPA signing of Nabon 1 and Nabon 2, currently ACE has 3 SPP-Hybrid Power Plant projects with total installed capacity of 70 MW that its’ PPAs have already been signed, and has only1 project; ACE Solar’s Ranong SPP-Hybrid Power Plant with installed capacity of 23 MW, that the PPA has not been signed yet and right now is in the process of requesting for extension of PPA signing deadline and SCOD with relevant government agencies.

 

Trinity Securities had a positive view towards the recent signing of PPA of Nabon 1 and Nabon 2 SPP-Hybrid Power Plant, thus giving a “BUY” recommendation on ACE with a  target price of ฿5.20/share based on the DCF method from 19 power plants that have already achieved the COD and 13 projects under negotiation, totaling 450 MW of a combined capacity. Currently, the ACE’s share price represents a 2021 PER of 17x and a 2022 PER of 12x, still low compared to the prospects for growth.