Damo: AI boosts electricity demand, and the country's energy becomes a big winner
Damo: AI boosts electricity demand, and the country's energy becomes a big winner
With the advent of the boom in artificial intelligence (AI) technology, Morgan Stanley, an internationally renowned investment bank, believes that demand for electricity will surge and the country's energy $TENAGA(5347.MY$ It will be one of the main beneficiaries.
Morgan Stanley pointed out that demand in fields that promote the development of AI technology, such as data centers, power generation, and power grids, is strengthening, which will benefit several Asian-related businesses such as National Energy.
“In the future, 50 billion US dollars (about RM235.4 billion) will be invested in the AI and data center fields in the region. We see that power generation companies and power grid operators in the region will have room to strengthen in the future.”
The agency added that it is estimated that an additional 1 gigawatt (GW) of electricity will be needed in the future as more data centers are built.
After Google announced that it will invest 2 billion US dollars (about RM9.4 billion) in Malaysia to build data centers and cloud technology facilities, National Energy became one of Morgan Stanley's preferred stocks.
“According to our estimates, the Google facility will increase Malaysia's electricity demand by an additional 350 megawatts (MW), boosting investors' confidence in the country's energy. After all, the company is the only power grid operator in Malaysia.”
There is room for stock price to rise 6%
Currently, national energy stocks are also included in the iShares MSCI Malaysia ETF (6.7% weight) and the Global X FTSE Southeast Asia ETF (2.3% weight).
According to FactSet's survey of analysts, the average target price for National Energy is RM14.62.
In contrast, the stock was priced at RM13.80 as of June 20, with room for growth of 5.94%.
Furthermore, the Singaporean Keppel company $Keppel(BN4.SG$ and Singapore Telecom $Singtel(Z74.SG$ They are the other two beneficiaries of the AI boom that Morgan Stanley is optimistic about.
Source: Nanyang Siang Pao
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