• Integrated infra major, YTL, offers a cheaper route to YTLP’s DC growth, with the share price trading at a deep discount to the NAV.
• Utilities and cement remain the earnings anchors, with DC capacity expansion and building-materials demand supporting medium-term growth.
• Initiate with Outperform and a TP of RM2.60. Execution of the DC buildout and resilient cement earnings could support a valuation re-rating.
Macquarie Equity Research, November 3, 2026
YTL Corp
OUTPERFORM
Target Price: RM2.60
• A cheaper route to YTLP. We believe YTL Corp offers an alternative route to gain exposure to YTLP’s DC growth while benefiting from its cement, property and hospitality businesses. YTLP/Malayan Cement account for 67%/13% of our SOTP, making these the key drivers for the group. YTL Corp is currently trading at a 21.4% discount to its NAV, vs five-year historical discount of 7.7%. Should the discount reverse to mean, implied fair value could be as high as RM3.00.
• Utilities: DC ramp-up drives the next leg. We expect YTLP’s operational DC capacity to expand from 150MW at end-FY26 to 500MW by endFY28E, supporting utilities revenue CAGR of 9-10% across FY27-29E. Its two Johor campuses provide a longer-term DC opportunity of at least 2.4GW, although the pace of development remains dependent on customer commitments and execution. Alongside established power and water operations, the DC ramp-up should lift utilities PBT margins to 14.6% by FY29, with the segment contributing ~60% of group PBT.
• Cement: Building a broader earnings base. Malayan Cement remains the core platform, with infrastructure, industrial and DC developments supporting demand for cement and higher-specification concrete. The additions of NSL and CEPCO broaden the group’s exposure across the construction value chain. We forecast building-materials revenue CAGR of 11-15% across FY27-29E, although PBT margins should normalise from a strong FY26 base.
Valuation: Our TP of RM2.60 is based on a discounted NAV of 20%. We value YTLP using our existing SOTP, while the other listed entities are valued at current market prices (as of 30 Oct 2026).
Catalysts: 1) DC commissioning and earnings delivery; 2) stronger cement and concrete demand, alongside operating efficiencies; and 3) external construction wins from its ~RM8bn tender book.
Investment Thesis and Recommendation
We initiate coverage with Outperform. YTL Corp offers a combination of YTLP’s DC growth and an established cement earnings base, with its asset portfolio not fully reflected at current levels. The DC ramp-up and sustained building-materials earnings should reinforce recognition of the group’s value.