PETALING JAYA: YTL Power International Bhd
’s 100 megawatt (MW) data centre powered by artificial intelligence (AI) in Kulai, Johor, is expected to be fully ready by the second quarter of 2025 (2Q25).
As of now, the buyers for 80MW of the 100MW capacity has yet to be finalised.
Kenanga Research anticipates the AI data centre to have a significant impact on YTL Power’s earnings in financial year 2027 (FY27), with a projected net profit of RM987.9mil once it becomes fully operational at 100MW capacity.
After a recent site visit to the YTL Data Centre Park in Johor, the research house updated its assumptions for the data-centre segment.
“As a result, we maintain our FY25 net profit forecast, while raising our FY26 earnings estimate by 9%. In our forecast numbers, we have assumed only 20MW for the AI data centre,” the research house said.
The data centre, for which YTL Power is working together with Nvidia Corp, is the second phase of a five-phase development, with the entire project being undertaken by YTL Data Centre Sdn Bhd (YTL DC) over a 10-year period.
Kenanga Research said the first 20MW of the data centre will be taken up by YTL AI, a separate entity from YTL DC.
“This capacity is expected to be ready by 1Q25, while the delivery of building for the remaining 80MW will be delivered by 2Q25.
“YTL Communications is named as a preferred cloud partner, according to Nvidia’s website,” the research house said.
Kenanga Research also highlighted that the first phase of a 32MW data centre of is being built for Sea Ltd, the parent of eCommerce platform Shopee.
Of the 32MW, a total of 8MW was delivered in 1Q24.
“The second block of 8MW is scheduled for delivery by the end of this year.
“According to the schedule, the third and fourth blocks of 8MW each will be delivered to Sea Ltd in 1Q26 and 1Q27, respectively,” the research house said.
As for the third phase of the data centre, the first building with a capacity of 40MW has secured a user agreement under a co-location model.
The structure is expected to be delivered by mid-2025.
“The delivery timeline for the second building is yet to be finalised, as negotiations with a potential user (likely the same entity as for the first building) are ongoing.
“While the third phase adopts a co-location model, the mechanical and engineering systems will be customised to meet the specific requirements of the client,” said Kenanga Research.
Looking ahead, Kenanga Research said it continues to see significant value in YTL Power following a recent share price retracement.
However, the key focus remains on data-centre delivery, which will be critical to its earnings performance.
“We continue to like YTL Power for its earnings stability backed by various regulated assets globally, the strong near-term earnings prospects of power generator PowerSeraya in Singapore backed by gas inventory locked in at low prices, and its longer-term growth potential driven by its data centre and digital banking ventures.”
Kenanga Research maintained its “outperform” call on YTL Power, with an unchanged target price of RM5 per share.
