YTL Corp shares hit another fresh high as rally extends

• Shares in YTL Corp have surged 31% in less than two months into the year.

KUALA LUMPUR (Feb 26): Shares in YTL Corp Bhd hit another new record high on Monday, as investors continued to accumulate the utilities-to-resorts conglomerate’s stock following stellar earnings.

YTL Corp rose to a high of RM2.59, before paring gain to 3% and settled at RM2.54, valuing the company at RM28.55 billion at midday trading break. The stock was the third most active stock in terms of volume on Bursa Malaysia, with close to 39 million shares changing hands.

All three institutional analysts covering YTL Corp rate the stock a 'buy'. The median 12-month target price (TP) is RM2.66, according to Bloomberg, which indicates a potential 4.7% gain from the current share price.

Shares in YTL Corp have surged 31% in less than two months into the year.

Trading volume — an indicator of investors’ interest — has spiked along with the share price gain since Dec 11 last year, when the company announced a partnership with US tech giant Nvidia Corp to build a data centre in Johor.

Part of the optimism has been also due to a jump in shares in YTL Corp's utility arm that have racked up a 57% gain since the start of the year, following above-consensus results.

YTL Corp has a 49.08% direct holding and another 6.49% indirect stake in YTL Power International Bhd, which also touched a new all-time high of RM4.24 on Feb 2. YTL Power edged up 1% to RM4.06 on Monday.

Both YTL Corp and YTL Power will be members of the MSCI Malaysia Index from Feb 29, as well as constituents of the country’s benchmark index FBM KLCI since Nov 30.

YTL Corp's net profit for the second quarter ended Dec 31, 2023 rose sixfold to RM589.21 million from a year earlier, lifted by stellar results from YTL Power as well as Malayan Cement Bhd. Revenue for the quarter rose by 14.2% to RM7.53 billion.

YTL Power, which has wider analyst coverage, has rallied strongly, thanks to growth prospects for its data centre business that will complement steady earnings from power generation and water-and-wastewater services.

There were 10 'buy' calls out of 11 analysts covering YTL Power, and one has a 'hold' rating, with a median 12-month TP of RM4.57, according to Bloomberg.

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