ALL IN, RHB Research views that contractors remain occupied with jobs on hand, coupled with upcoming ones with the total value of work done at MYR43.9 bil in quarter two calendar year 2025 (2Q2025)– a record high.
According to Tenaga Nasional, it signed five electricity supply agreements (ESAs) for seven DC projects in the country with a combined electricity demand of 733MW for year-to-date (YTD) CY25.
Assuming a conservative power usage effectiveness ratio of 1.4, the maximum electricity demand of 733MW by DCs should translate to around 524MW of DC capacity (which could be worth MYR10.5 bil of job value, based on a MYR20 mil construction cost per MW benchmark).
Johor alone has 1,473MW of committed IT DC capacity (according to DC Byte’s market spotlight report) while Kuala Lumpur has 960MW of planned DC capacity according to JLL’s 1H25 Asia Pacific DC Market Dynamics report.
“Additionally, we estimate the 389-acre land in Port Dickson acquired by Pearl Computing Malaysia (PCM) to likely accommodate 500MW-1GW of DC capacity,” said RHB.
The aforementioned total planned capacity of between 2,933 MW and 3,433MW in these three areas could translate into a construction value of MYR58.7-68.7 bil.
Awards related to the elevated Automated Rapid Transit (ART) system in Johor is expected to be announced by year-end, with three consortiums believed to have submitted proposals to the Public Private Partnership Unit of the Government.
Other key projects include tenders related to the Penang Light Rail Transit (LRT) system works (estimated at MYR3-4 bil), which are likely to be known in the second half of 2025 (2H25) while Segment 2 of Penang LRT connecting Komtar and Penang Sentral (estimated at MYR5-6 bil) could see tenders being advertised in October.
In the grand scheme of things, the onset of the 13th Malaysia Plan (13MP) from 2026 until 2030 has an earmarked development expenditure worth MYR430 bil (the highest ever), which could pave way for more infrastructure projects.
Key downside risks to our sector call are unexpected slowdown in job rollouts, labour shortages, and scale down of DC investments into Malaysia. —Sept 8, 2025
