The green data centre (DC) sector is set to expand significantly with YTL Power's continuous growth and strategic initiatives, according to RHB Investment Bank (RHB).

RHB maintained its BUY rating on YTL Power, with a target price of RM6.68, projecting a 35% upside and approximately 2% yield for Fiscal Year 2025 (FY25F).

Following a site visit, RHB analysts reported optimism for YTL Power's Green Data Centre Park in Kulai, Johor. The first 48MW data centre is commercialised, with ongoing talks to secure additional capacity and plans to configure parts of it into an artificial intelligence (AI) data centre.

The first 20MW of YTL Power's 100MW AI-DC is nearing completion, with server installation expected by year-end. The entire AI-DC capacity is projected to be operational by mid-2025, contributing significantly to the company's earnings from 2026 onwards.

YTL Power is also constructing a new data centre phase with 40+40MW capacity, expected to be completed by mid-2025. This facility aims to attract hyperscalers and leverage vacant land for future solar energy projects, enhancing its green energy credentials.

RHB's positive outlook is further supported by the expected supply of Nvidia Corp's chips by the first half of the calendar year 2025 (1HCY25). This positions YTL Power favourably amidst rising demand for AI and green energy solutions, projecting robust growth for the company's data centre operations.

The bank's analysis underscores YTL Power's strategic positioning within the growing green data centre market.