PETALING JAYA: HE Group Bhd
’s latest RM102mil electrical contract for a Johor data centre (DC) is expected to contribute about RM7mil in net profit over the contract duration. This is assuming a 7% profit after tax margin, according to Phillip Capital Research.
The contract from an undisclosed main contractor commenced in June 2026 and is scheduled to be completed by September 2027. HE Group has secured RM230mil in new contracts year-to-date, representing 115% of the research house’s previous order-book replenishment target of RM200mil for 2026.
“We gather that this project is an expansion work for an existing DC operator in Malaysia. With this win, HE Group’s estimated outstanding order book stands at a record high RM250mil, providing strong earnings visibility until end-2027.
“HE Group’s tender book stands at about RM900mil, predominantly driven by DC-related projects, which account for 94% of the total. The group is awaiting the tender result for an additional RM50mil to RM60mil DC project in Johor from the same main contractor,” said Phillip Capital Research.
Following the latest win, the research house has raised its order replenishment assumption for 2026 to RM300mil by factoring in stronger new contract win momentum.
It has raised the earnings per share forecast for 2026 to 2028 by 10% to 15%. Phillip Capital Research has reiterated its “buy” rating on HE Group, raising the 12-month target price to 73 sen from 57 sen earlier.
