PETALING JAYA: YTL Power International Bhd
is resetting for long-term growth given the group’s compelling blend of defensive regulated assets and high-growth ventures, says Kenanga Research.
In a report, the research house said it forecasts the group’s data centre (DC) segment to become a major earnings engine, contributing RM327mil in pre-tax profit (PBT) in the financial year 2028 (FY28), compared with an earlier estimate of RM120mil PBT for FY26.
YTL Power has significantly raised its ambitions, revealing an aggressive capacity target to grow its DC campus to 1,000 megawatts (MW) by 2028, doubling its initial 500MW target.
As of February 2026, YTL Power operated 110MW of live capacity, with the full 278MW facility expected to be operational by end-2027. On the group’s UK-based subsidiary Wessex Water, Kenanga Research said the Competition and Markets Authority has granted Wessex a 1.7% tariff uplift for the final three years of the 8th Asset Management Plan (AMP8) cycle (2027/2028 to 2029/2030).
“This raises the nominal tariff growth to 5.7% (comprising a 3.4% real increase plus a 2.3% inflation adjustment), from the initial 4% nominal rise proposed in the AMP8 cycle,” the research house added.
To recap, Wessex suffered pre-tax losses of RM94.7mil and RM86.5mil in FY23 and FY24, respectively, as UK inflation spiked financing and operating costs.
The hefty inflation-related adjustments in FY25 have already repositioned Wessex Water as a significant earnings contributor.
Meanwhile, the upcoming third quarter of financial year 2026 (3Q26) of Singapore-based YTL Power Seraya Ltd, a subsidiary of YTL Power, will be a key testing ground for PowerSeraya.
This marks the first full-quarter following the expiry of its favourable 40% gas contract in December 2025.
According to the research house, the upcoming 3Q26 results have benefited Power Seraya from low input costs for the past three years.
However, it now faces a phased transition to market rates.
The remaining low-cost blocks are scheduled to expire as follows: 20% in late 2027, 20% by August 2028, and the balance in 2029.
YTL Power shares closed at RM3.93 yesterday.
