Will $MRCB / 1651 (MALAYSIAN RESOURCES CORPORATION BERHAD) becomes the Biggest Winner in Penang LRT?

The unveiling of the inaugural Penang LRT line, known as the Mutiara Line, represents a significant advancement in the state's transportation infrastructure. Stretching across 28 kilometers and featuring 22 stations with overhead tracks, this line is poised to revolutionize travel within Penang. It offers direct connectivity to Penang International Airport and links seamlessly with the Electric Train Service (ETS) at Butterworth, with plans for KOMTAR to serve as the future ETS interchange.

Prioritizing accessibility and inclusivity, the Mutiara Line is equipped with 1,220 car parking spaces, 1,315 motorcycle parking spaces, and is designed to accommodate persons with disabilities (OKU-friendly). Operating from 6:00 am to 12:00 am, it aims to meet the diverse needs of commuters throughout the day and night.

The line's trajectory originates from Penang Sentral on the mainland, extending to Macallum, the proposed initial station on Penang Island. It traverses key locales such as Komtar, Jalan Gurdwara, Solok Sungai Pinang, and East Jelutong before reaching its terminus at Silicon Island. Notably, the revised plan omits stations initially proposed at Bandar Sri Pinang and Sky Cab along Tun Dr Lim Chong Eu Expressway.

The LRT is poised to yield significant advantages for various stakeholders, including companies which own lands situated near its routes and those awarded contracts for its construction. Among these, MRCB appears to be the primary beneficiary. Analysts widely speculate that MRCB stands a strong chance of securing the Penang LRT project due to its extensive track record, although it faces stiff competition from $GAMUDA / 5398 (GAMUDA BERHAD), another prominent player with a similar legacy. Notably, both companies collaborated on Malaysia's inaugural MRT project. However, MRCB holds a unique position: it stands to benefit not only from construction contracts but also from land appreciation.

One key factor bolstering MRCB's advantage is its ownership of Penang Sentral, the designated terminus for the LRT on the island. Modeled after KL Sentral in Kuala Lumpur, Penang Sentral is a comprehensive transit-oriented development in Butterworth, Penang, encompassing public and intercity bus terminals, as well as connectivity to the Butterworth railway station and Penang Ferry terminal. Despite encountering setbacks, such as retail closures precipitated by the pandemic, Penang Sentral has completed its retail mall and is progressing with its office tower, albeit slowly.

The advent of the Penang LRT holds promise for Penang Sentral's revival, potentially attracting new businesses and foot traffic to its premises. However, the fate of planned components, such as hotels and serviced apartments, remains uncertain, given the challenges faced by the retail sector. Notably, Penang Sentral's development has been launched since its inception during Tun Abdullah Badawi's tenure as prime minister. The LRT project presents a pivotal opportunity to galvanize progress, particularly for MRCB, which owns approximately 32-acre land parcel within the development.