Maybank IB visited YTL Power's Kulai site and reaffirmed the commendable progress achieved thus far with regards to data centre construction. The house said it continues to view YTLP's risk-reward favourably and has reiterated a BUY call with an unchanged SOP-based TP of MYR4.70. Potential re-rating catalysts include 1) affirmation of Wessex's recovery over the medium-term, and 2) positive progress on its AI compute business.

Phase 1 is operational
The Johor Data Center Park is located in Kulai on a 664ha of land previously acquired from Boustead. The entire park has a planned IT load of >400MW, spread over 6 phases. There are plans for an on-site solar farm. The first phase, Johor Data Center 1 (JDC 1) with a prevailing IT load of 48MW for co-location (expandable to 72MW), has already been operational since May 2024, with an anchor tenant taking up 32MW.Subsequent phases under construction

Meanwhile, phase 2 (JDC 2) with a planned IT load of 20MW + 80MW to house AI servers, is currently being constructed, with the initial 20MW ready for handover to sister company YTL AI Cloud (which will offer AI compute services). As highlighted in YTLP's recent results call, delivery timelines of Nvidia's AI GPUs are still being negotiated. Separately, phase 3 (JDC 3) with a planned IT load of 40MW (committed hyperscale customer) 40MW for colocation, is also being constructed. The team has not yet begun work on the solar farm.

Maintaining forecasts
For FY25E, Maybank said it continue to expect further Wessex recovery to offset PowerSeraya tapering. The earnings forecasts and MYR4.70 TP for YTLP (based on a sum-of-parts, with the operating entities each valued by DCF) are unchanged, with data centre / AI accounting for MYR0.47/share (12% IRR on MYR15b capex). The house notes that data centres typically require 2-3
years to be net profit accretive. Meanwhile, AI computing would realistically only begin contributing to revenue earliest in FY26E.