Analysts are optimistic about data center potential Yang Zhongli Electricity is worth RM6.25

This is the highest target price currently given by the analytical community, compared to the stock's market price of about RM4.90, which means there is still room for growth of 27.5%.

Looking back at Yang Zhongli Electric Power's stock price performance, the stock began to rise in March of last year and has risen 94.49% since the beginning of the year.

In a report today, the analyst re-included the potential revenue of the data center in the summed up valuation method (SOP). Previously, the analyst only used the net asset value of the data center, which could not truly reflect the company's true profit level.

“After taking into account the Sentul data center (5 MW) and the non-AI Johor data center (8 MW), we will increase our net profit for fiscal year 2025 by 1%.”

The analysts also raised the net profit forecast for the 2026 fiscal year by 27% to reflect the revenue brought by the Johor No. 1 data center in the AI field. The analysts also took into account that Singapore Donghai Group may use another 8 MW data center.

Analysts believe that the 2026 fiscal year will better reflect the potential profits of data centers. The 100 megawatt data center is expected to start operation at the end of 2024, so it can contribute throughout the year. As for the non-AI sector, Donghai Group is also expected to obtain 8 megawatts of production capacity this month. The Tokai Group received a total of 48 megawatts.

In addition, data centers are also quite profitable. Analysts estimate that if revenue is RM7 billion, based on 20% profit, 100 MW AI data centers can bring in RM1 billion in profit.

As for non-AI businesses, analysts expect that the data centers in Sentul and Johor will contribute RM5.3 million and RM16.8 million respectively.

“In Singapore's Silaya Island data, the heart can also bring stable and sustainable basic income. Partnering with Nvidia, combined with low land and energy costs, is a competitive advantage for this data center.”

Source: Nanyang Siang Pao