PETALING JAYA: Eco World Development Group Bhd
(EcoWorld Malaysia) has booked in RM907mil worth of land sales to three data centre (DC) players within two years, compared to its land cost of only RM211mil.
The group hived off this last parcel of land at a record high price, compared to its previous two land disposals at Quantum Edge, said RHB Research.
This latest sale should improve its war chest for future land banking and funding for the ongoing core-and-shell construction of the DC.
MBSB Research also said the total land disposal is expected to improve the balance sheets of EcoWorld Malaysia.
The research house estimates net gearing to decline to 0.25 times from 0.3 times in the first quarter of financial year 2026 (FY26).
Overall, MBSB Research sees stable prospects for EcoWorld Malaysia with a better earnings outlook for FY26 due to land sales recognition.
Moreover, rental contribution from Pearl Computing Malaysia Sdn Bhd’s DC is expected to provide an earnings catalyst beyond FY27 as the DC will be completed by the end of FY27.
MBSB Research has maintained its “neutral” outlook on EcoWorld Malaysia as it sees that positives are largely priced in with limited upside at this juncture.
The research house retained its target price (TP) at RM2.09 a share based on a 15% discount to its revalued net asset value.
Meanwhile, RHB Research kept its “buy” call with a new TP of RM2.78 from RM3.06 a share previously.
The lower TP reflects current market headwinds arising from the Middle East conflict.
EcoWorld Malaysia disposed of 49.59 acres of industrial land at its Quantum Edge industrial park in Kulai, Johor, to hyperscale DC operator KNBDC Malaysia Five Sdn Bhd for RM280.8mil.
The land sale to KNBDC comprised the final two industrial land parcels at Quantum Edge.
Notably, the sale is expected to be completed by the first half of FY27.
Management’s deliveries for the new industrial parks – Eco Business Park (EBP) 7, EBP 8 and EBP 9 – are highly anticipated as well, RHB Research said.
MBSB Research noted that higher selling prices were likely driven by land appreciation in Johor, fuelled by robust buying interest and the established infrastructure of Quantum Edge.
The research house said the land disposal price was within the selling price of RM110 per sq ft to RM160 per sq ft for a recent land transaction in Johor.
