[%NTQr%]
Research by TA
Buy - TP RM1.05

"Turning More Constructive"

We raise our sum-of-parts derived TP to RM1.05/share (from RM0.80/share previously) following the earnings upgrades in this report and after factoring a 3% ESG premium in accordance with our 4-star ESG rating for MALAKOF. We also lower our WACC assumption to 8.3% in our valuations to reflect improved prospects of capacity replenishment/renewal given increasing demand from data centre build-up in the country, coupled with existing plant-up plans under the PGDP. Given a more attractive return of +19.4% at our new TP, we upgrade Malakoff to Buy from Hold previously. At our revised earnings, MALAKOF is trading at 5.1x/4.9x FY25/26 EV/EBITDA, at a discount to historical mean of 5.2x. Dividend yield remains attractive at 5.1%-6.3% throughout our forecast horizon.

Analyst:
Kaladher Govindan 
[%nKuy%]

$KLSE-MALAKOF
Research by TA
Buy - TP RM1.05

"Turning More Constructive"

We raise our sum-of-parts derived TP to RM1.05/share (from RM0.80/share previously) following the earnings upgrades in this report and after factoring a 3% ESG premium in accordance with our 4-star ESG rating for MALAKOF. We also lower our WACC assumption to 8.3% in our valuations to reflect improved prospects of capacity replenishment/renewal given increasing demand from data centre build-up in the country, coupled with existing plant-up plans under the PGDP. Given a more attractive return of +19.4% at our new TP, we upgrade Malakoff to Buy from Hold previously. At our revised earnings, MALAKOF is trading at 5.1x/4.9x FY25/26 EV/EBITDA, at a discount to historical mean of 5.2x. Dividend yield remains attractive at 5.1%-6.3% throughout our forecast horizon.

Analyst:
Kaladher Govindan 
kaladher@ta.com.my

$MALAKOF / 5264 (MALAKOFF CORPORATION BERHAD)