YTL Corp and YTL Power in MSCI Malaysia Index

Analysts remain bullish on the prospects of both companies, premised on the robust job flows and the potential contract wins.

PETALING JAYA: The Yeoh family’s YTL Corp Bhd and YTL Power International Bhd slipped on profit-taking, following news about their addition into the MSCI Malaysia Index.

Shares of YTL Corp were down by 1.29% to RM2.29 at market close yesterday, while its subsidiary YTL Power fell by 1.73% to RM3.98.

Interestingly, shares of Dialog Group Bhd – which was booted out of the index – inched up by 0.56% to RM1.81.

All three counters were among the most actively traded stocks yesterday.

MSCI, a global investment services provider, said in a statement the changes in the MSCI Malaysia Index will be effective at the close of Feb 29, 2024.

The MSCI Malaysia Index is designed to measure the performance of the large and mid-cap segments of the Malaysian market.

With 31 constituents, the index covers about 85% of the Malaysian equity universe.

As at Jan 31, 2024, the index had a market capitalisation of US$93.75bil.

Its constituents had an average market cap of US$3.02bil, with its largest constituent being Public Bank Bhd with a market cap of US$13.51bil.

It is noteworthy that YTL Corp and YTL Power are also constituent stocks of FBM KLCI, the benchmark index of the Malaysian stock exchange.

Billionaire tycoon Tan Sri Francis Yeoh and family control an equity interest of 65% in YTL Power. Meanwhile, they have a 51% stake in the parent company YTL Corp.

YTL Corp’s share price has risen by 309% in the past one year, while the YTL Power stock is up by close to 438%, reaching a market capitalisation of RM25.24bil and RM32.47bil, respectively.

Analysts remain bullish on the prospects of both companies, premised on the robust job flows and the potential contract wins.

YTL Corp, for example, has been touted as one of the key beneficiaries from the revival of mega projects such Mass Rapid Transit 3 and the Kuala Lumpur-Singapore High-Speed Rail.

Meanwhile, YTL Power is likely to benefit from its strategic expansion into data centre and renewable energy (RE) businesses.

Recall that YTL Power’s 60%-owned YTL Communications has striked a deal with Nvidia to develop artificial intelligence (AI) infrastructure powered by Nvidia’s technologies.

The infrastructure will be hosted at YTL Power’s data centre park in Kulai, Johor, and is intended to provide AI computing services to the country.

In a research note last December, MIDF Research opined that YTL Power is also a potential beneficiary of the strong RE growth trajectory under the National Energy Transition Roadmap, particularly for RE exports, given its presence in the Singapore power sector.

It also added that the company has an undemanding valuation and an attractive dividend yield.

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