Kinergy Advancement Berhad - Secures Hyperscale Data Centre Job from Gamuda
Tue, 13-Oct-2026 07:23 am
by Research Team • Apex Research

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KINERGY (0193)

Target Price (RM)

0.67

Recommendation

Buy

·   On 12 October 2026, Kinergy secured a RM47.5m subcontract from Gamuda Engineering for electrical works at a hyperscale data centre in Bandar Spring Hill, Port Dickson. The end client is a US-headquartered multinational technology company, with completion scheduled for 1Q2028.

·   This is Kinergy's first standalone core & shell electrical package for a data centre. As its 2024 EdgeConneX contract was delivered through a JV. The step up gives Kinergy a reference for larger data centre electrical packages.

·   The award increases the orderbook by approximately 3.5% to RM1.40bn across 25 projects, from RM1.35bn across 24 projects.

·   Maintain BUY with an unchanged TP of RM0.67, based on 22.7x FY28F EPS of 2.94 sen. We make no changes to our forecasts as the contract is within our forecast assumptions.

 

Contract Details. Kinergy has been awarded a subcontract worth about RM47.5m by Gamuda Engineering Sdn Bhd (GESB), a wholly-owned subsidiary of Gamuda Berhad. The works cover the construction, completion, testing and commissioning of electrical services for a hyperscale data centre in Bandar Spring Hill, Port Dickson. The end client is a multinational technology company headquartered in the United States.

 

The scope covers core & shell electrical infrastructure. This includes high tension (HT) and low voltage (LV) distribution, substations and switchgear, transformers, cabling, power distribution, lighting, UPS systems, EV charging and related controls. With the contract set to run until completion of the works, which is scheduled for 1Q2028.

 

Our View. We view the award positively as it marks a step up in Kinergy’s data centre credentials. Assuming a 8% PAT margin, the RM47.5m contract could generate an estimated cumulative PAT of RM3.8m over its tenure to 1Q2028. This is equivalent to about 9.3% of our FY26F PAT of RM41m, although the actual contribution will depend on project margins and the timing of revenue recognition. Unlike its previous cable installation contract in 2024, which was delivered through a JV, this contract is a standalone core-and-shell electrical package. This broadens Kinergy’s project reference base and strengthens its position for future data centre tenders, especially repeat work with Gamuda.

 

Outlook. This award lifts Kinergy’s orderbook by about 3.5% to RM1.40bn across 25 projects, from RM1.35bn across 24 projects, at a book-to-bill ratio of about 2.9x on FY25 revenue of RM478m, giving close to three years of earnings visibility. This contract also opens a new growth avenue in data centre electrical works. With MIDA reporting RM95.8bn in approved data centre and cloud-computing investments in 1H2026, the progression of these projects towards construction could drive demand for specialised electrical and power infrastructure, creating further opportunities for Kinergy, though the timing and conversion of these opportunities remain uncertain.

 

Forecast. No changes to our forecast as the contract is within our orderbook assumptions. We have also yet to include the proposed placement within our forecasts, as it has not been completed.

 

Valuation and Recommendation. Maintain BUY with an unchanged TP of RM0.67, based on 22.7x FY28F EPS of 2.94 sen, with a three-star ESG rating.

 

Key Risks. Execution risk, margin compression, slow pipeline conversion.

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