The partnership is to jointly develop the AHTV and collaborate to identify vendors and investors for the hub
by ANIS HAZIM / Pic by TMR FILE PIX
PUBLIC Investment Bank Bhd (PublicInvest) remains positive on DRB-Hicom Bhd’s growth prospects and retains its ‘Outperform’ call with an unchanged target price of RM1.95 as the group inks a memorandum of understanding (MoU) with Zhejiang Geely Holdings Group Co Ltd.
DRB-Hicom recently announced that it will partner Zhejiang Geely to jointly develop the Automotive Hi-Tech Valley (AHTV) and collaborate to identify vendors and investors for the hub.
“We are positive about this development as the involvement of Zhejiang Geely, known for its strength in technology and mobility ecosystem is a boost for the AHTV,” PublicInvest’s analyst Denny Oh said in a research note yesterday.
He also views that the development can be an impetus for automobile and component manufacturers from China and other parts of the world to invest in production facilities in the AHTV.
Currently, Zhejiang Geely holds a 49.9% stake in national carmaker Proton Holdings Bhd, while owning and managing a number of brands including Geely Auto, Lynk & Co, Zeekr, Geometry, Volvo Cars and Polestar.
“It has been developing cutting-edge technologies in new energy, shared mobility, vehicle networks, autonomous driving, on-board chips, low-orbit satellites and laser communication to embrace the upcoming multi-dimensional mobility ecology,” he said.
Meanwhile, the AHTV is envisioned to be an automotive industry centre for the Asean region and aims to be the next generation vehicle hub in Tanjong Malim, Perak.
“It will cover an extensive automotive and mobility solutions value chain from a technology research and development (R&D) centre to manufacturing cluster as well as supporting services and associated ecosystems including logistics, research university, training and learning institutions,” he noted.
Moreover, the AHTV is estimated to value RM32 billion in total investments from various parties, including vendors and potential investors for the next 10 to 12 years. At the same time, DRB-Hicom has also entered into an MoU with the Perak state government to jointly identify suitable additional land in the area to be earmarked for the AHTV.
Hence, the analyst opined that the AHTV is a salient term for both DRB-Hicom and Zhejiang Geely to work together to attract vendors and investors, develop an R&D centre and explore the establishment of a research institute or university in the AHTV.
Additionally, he said that the AHTV will be developed as a smart city to jointly advance the AHTV towards the scope of “Two Countries, Twin Park” under the Malaysia-China joint development framework mechanism.